B40/1994 PAYMENT OF SERVICE PENSION - PENSIONER IMPRISONED

DATE OF ISSUE:  14 SEPTEMBER 1994

PAYMENT OF SERVICE PENSION - PENSIONER IMPRISONED

PURPOSE

To advise Commission's policy in regard to two issues related to service pensioners who are imprisoned.

BACKGROUND

2.Subsection 55(1) of the Veterans' Entitlements Act (VEA) provides:

"...if a person who is receiving a service pension goes to gaol, the Commission may direct that a pension instalment or instalments that would otherwise be payable while the person is in gaol are to be forfeited or suspended".

3.Prior to the rewrite of Part III that occurred in 1991 Subsection 67(1) of the VEA provided:

"... where a service pensioner is imprisoned in connection with his or her conviction for an offence, the Commission may ... direct that each instalment of the service pension... be forfeited or suspended."

ISSUES

4.The first issue is:

whether subsection 55(1)of the VEA allows the Repatriation

Commission to decide that a person's service pension instalments are to be forfeited or suspended during imprisonment in the following circumstances:

• where a person applied for service pension before entering prison but the application had not been determined before he or she was imprisoned; and

• where a person applies for a service pension while in prison.

5.Current Policy: Issue 1:

Having regard to the Acts Interpretation Act 1901 and the explanatory memorandum to the VEA Amendment Bill 1991, it is considered that there was no intention to change the meaning and make a distinction between persons who applied for service pension before they went to prison and persons who applied after they went to prison.

6.Therefore, if an application is received from a person who is in gaol, the claim is to be processed and if granted, para 36A(1)(b) comes into effect, ie pension may not be payable as determined under s55 and 55A.

7.The second issue is:

(i)whether, if one member of a couple is imprisoned, the couple is considered to be living permanently apart within the meaning of paragraph 5E(2)(a) of the VEA and;

(ii)whether the instalments of service pension can be redirected to the other member of the couple.

8.Current Policy: Issue 2:

The fact that section 55A of the VEA exists to deal with the particular situation of payment to a partner where a service pensioner is in prison, and the fact that it still refers to the other member of the couple as the service pensioner's partner, indicates that such a couple is not generally to be considered as "living separately and apart from the other person on a permanent basis".  This is the case unless one member of the couple has formed an intention to separate and has acted upon that intention, or, alternatively, acts as if the relationship has been severed.

9.In any event it is unlikely, even if section 55A were not in the Act, that paragraph 5E(2)(a) of the VEA would be interpreted as meaning that a member of a legally married couple is no longer a "member of a couple" for the purposes of the VEA if one member is in prison.  This is because of the way in which the Courts have interpreted the meaning of the word "separation" and the phrase "living separately and apart".  Therefore, instalments of service pension can be redirected to the other member of the couple.

PROCEDURES

10.The procedures relating to the forfeiture or suspension of service pension to a veteran, partner and children where the veteran has been imprisoned are those outlined in the current General Orders Service Pension, Payment Issues, Administration of Payments, Imprisonment.  The GO's correctly outline the procedures, as follows:

Claim Made Prior to Imprisonment

• Where a person has applied for service pension before entering prison but their application has not yet been determined, any service pension that is assessed will be granted from the date of application.  If it is decided that due to imprisonment the person's pension is to be suspended, it will be suspended from the second pension pay-day following the date of imprisonment.   If the person has a partner or children, any redirection of amounts will commence, in the normal way, from that pay-day.

Claim Made by Prisoner

• If a person applies for a service pension while in prison, any service pension assessed will be granted from the date of application.  If it is decided that due to imprisonment the person's pension is to be suspended, it will be suspended from the second pension pay-day after the date of grant.  If the person has a partner or children, any redirection of amounts will commence, in the normal way, from that pay-day.

11.If you have any enquiries concerning these matters please call Ann Donnelly on (06) 289 6441.

KAY GRIMSLEY

ASSISTANT SECRETARY

INCOME SUPPORT