Financial Hardship

When negotiating on repayment, financial hardship may occasionally be contended.  This does not immediately mean an overpayment will be written off or waived.  It is a preliminary part of the process only.

Retain copies of all communication on the claim file and/or PRACSYS.

•       Determine with impartiality.  Don't make value judgements about the debtor's individual financial particulars.  Pass the claim to another officer if this impacts on decision making.
•       Where financial difficulty is contended, discuss a reasonable repayment option, such as periodic rather than lump sum repayment.
•       Suggest a reasonable figure based on knowledge of any compensation benefit being received and concurrent superannuation, where applicable.  Use this as an initial figure to commence negotiations.
•       If no agreement on a set figure is reached, issue the debtor with a Statement of Financial Circumstances form (at Appendix 5).
•       Discuss any privacy concerns with the debtor, in particular when requesting details of sources of income other than from the debtor.  Indicate that the Privacy Act is not being breached as the information is being collected to assist only with compensation matters.
•       Assess returned forms based on the difference between income and expenses.
•       Calculate a percentage figure of any disposable income.  10% of that disposable income is usually the minimum acceptable rate of repayment per fortnight.
•       Negotiate using the 10% figure.