Departmental Instruction

DATE OF ISSUE:  22 July 1991



The purpose of this instruction is to advise of changes to Compensation matters which have been introduced by the Veterans' Affairs Legislation Amendment Act 1991.

2.A separate Departmental Instruction is being prepared for Income Support matters.

3.The amending legislation received Royal Assent on 25 June 1991.  However, the date of commencement of the following changes is 1 July 1991, unless otherwise indicated.


4.This instruction confirms and enlarges on Departmental Instruction (DI) B10/91 of 26/2/91.

War Widower's Pension

5.Amendments to the VEA extends eligibility for war widower's pension to spouses of all female members and veterans, irrespective of when death occurred, provided that at the time of death the female member or veteran was in receipt of the Special T&PI rate of pension or its equivalent, the Extreme Disablement Adjustment or where death is or was accepted as being related to service.

6.The earliest possible date of effect for payment in respect of war widower's pension is 22 January 1991, which was the date of announcement of the Government's decision to eliminate areas of discrimination against females from the legislation.  The selection of the retrospective date of effect enables benefits to be backdated to ensure that claimants are not disadvantaged by the delay from the time of announcement, 22 January 1991 to the date the legislation became effective, 1 July 1991.

7.In order to overcome problems associated with the legislative requirements covering the lodgement of informal and formal claims contained in the VEA generally, special transitional provisions have been incorporated into the VEA to enable potential claimants for war widower's pension to gain maximum payment of arrears to the date of the announcement.  These provisions extend only to claims for war widower's pension lodged before 1 October 1991.

Processing of Claims

8.As the legislation is now effective, any clients whose claims were previously registered in accordance with paragraph 7 of DI B10/91 should now be issued with a request to lodge a formal claim for war widower's pension.

9.Four sets of circumstances have been identified as requiring special attention in respect of the processing of claims for war widower's pension.

Claims where the female veteran was in receipt of EDA, T&PI pension or its equivalent and died prior to 22 January 1991.

10.In these circumstances, as there is currently no data recorded, the spouse must actually lodge a claim but eligibility for war widower's pension would be accepted automatically.

11.For those clients who lodged a claim (either formal or informal) prior to 1 October 1991, pension may be payable  from 22 January 1991.

12.For claims lodged on or after 1 October 1991, the normal provisions of the VEA relating to operation of the date of effect will apply.

Claims where the female veteran was in receipt of EDA, T&PI or its equivalent and dies after 22 January 1991.

13.There is no need for the spouse to actually lodge a claim as it will be processed automatically.  However, it may be necessary to obtain relevant details to arrange payment to the spouse.  The earliest possible date of effect for payment to the spouse will be the day following the date of death of the female veteran.

Claims to have death accepted as service-related where death occurred prior to 22 January 1991.

14.The spouse must lodge a claim in this case.  The claim should be investigated in the normal manner and in the event that the claim is successful, and if the claim was lodged before 1 October 1991, pension may be payable from 22 January 1991.

15.If the claim is successful but was lodged on or after 1 October 1991, the date of effect will be 3 months prior to the lodgement of the claim.

Claims to have death accepted as service-related where death occurs after 22 January 1991.

16.The spouse must lodge a claim in this case.

17.The claim should be processed in the normal manner and in the event that the claim is successful, the date of effect will be the day following the date of death or three months prior to the date of lodgement of the claim whichever is the later date.

Identification of Possible Claimants

18.It is not possible to identify potential claimants for benefits in respect of deceased female veterans from the information contained on the Client Data Base.  In many cases, the existence of a male spouse was not recorded as this was not relevant to disability related benefits provided to the female veteran.  Information regarding the rates of pension payable to deceased female veterans is also not available for cases in which death was recorded before the implementation of the EATERS system in 1987.

19.A listing of all known deceased female veterans will be provided to each State for manual action.  This listing will include the file number and name of the veteran.  Where available, eligibility information will also be provided. Eligibility data will indicate the type of entitlement (eg. IAS indicates an incapacity assessment), and the level or rate (eg. TPI indicates Special Rate).

20.It will be necessary for each case to be examined manually to determine whether a male spouse is recorded on file and, if so, to advise the spouse of potential entitlement to benefits resulting from the legislative amendments.

21.The listings will be forwarded shortly.

Payment of Pharmaceutical Allowance to Orphans not in Receipt of Orphan's Pension.

22.Section 118JA has been amended to provide for the payment of pharmaceutical allowance for orphaned student children over the age of sixteen years from the same date that this allowance commenced for all other eligible recipients, that is 20 March 1991.  This group was inadvertently excluded from entitlement in the 1990 Budget amendments to the VEA.

Amendment of the Commission's Review Powers Under Section 31 of the VEA.

23.A new paragraph 31(7)(aa) has been added to provide the Commission with greater flexibility in setting the date from which a decision under sub-section 31(6) of the VEA is to take effect.

24.Sub-section 31(8) has been amended so that increases in pension arising from a decision made in accordance with the sub-section may be expressed to operate from a date which is more than three months before the date on which the decision is made.

Removal of an Anomaly Affecting the Adjustment of Pension Following Lump Sum Compensation Payments Under the Commonwealth Rehabilitation and Compensation Act 1988.

25.Rates of pension payable to members of the Defence Force or Peacekeeping Forces and to their dependants, may be reduced in specified circumstances where the member or dependant is also in receipt of compensation payments.

26.Section 74 of the VEA details the way in which such payments are to be treated.  Specifically, sub-section 74(3) provides that, where a lump sum compensation payment is made, the person is deemed to have been in receipt of compensation for life, as determined in accordance with the Commonwealth Actuary's instructions, from the earlier of:

.the commencement date of pension; or

.the date the lump sum is paid.

27.Section 137 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 enables a former employee who is being paid compensation in weekly payments (of less than $58.05) to commute these payments to a lump sum.

28.Section 74 of the VEA does not take these provisions into account.  A strict interpretation of sub-section 74(3) of the VEA would require retrospective adjustment of the pension from the date pension was first paid, even if the pension had been previously adjusted for regular compensation payments received.

29.A new sub-section 74(3A) has been inserted into the VEA to ensure that persons electing to commute their compensation from regular payments to lump sum are not disadvantaged.  A consequential amendment has also been made to sub-section 74(3).

30.This means that, where a compensation payment is commuted to a lump sum under section 137 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988, and this Department pays pension for the same disability, the person is deemed to be in receipt of compensation payments for life, as determined by or in accordance with instructions issued by the Commonwealth Actuary, from the date of payment of the lump sum.

Section 30 of the Commonwealth Employees' and Rehabilitation Act 1988 inadvertently omitted from the Amendment to Section 74 of the VEA.

31.Section 30 of the Commonwealth Employees' Rehabilitation and Compensation Act 1988 (CERCA) also extends similar commutation provisions in respect of current employees as those provided for former employees by section 137 of that Act.  Unfortunately, this was overlooked in the proposal to amend section 74 of the VEA.

32.Action will be taken to include section 30 of CERCA in the next draft of VEA amendments.  In the meantime, if any cases involving serving members come to light, these should be referred to Central Office.

Definition of "disease"-new sub-section 5D(1).

33.This amendment is in response to the Administrative Appeals Tribunal decision in FOWLER.  The amended definition is intended to prevent conditions which are not medically defined as a disease being regarded as such for the purposes of the Act.

34.The amendment would ensure that temporary departures from the normal physiological state or a temporary departure from the accepted ranges of physiological or biological measurements that result from stress or the temporary effect of extraneous agents would not be included in the definition of "disease".  This would mean, for example, that the temporary effect of exercise on blood pressure or the temporary effect of alcohol on sensory faculties are clearly seen as conditions which do not come within the definition of "disease".  The definition would continue to exclude from the definition aggravation of a physical or mental ailment, disorder, defect or morbid condition.