DATE OF ISSUE: 11 FEBRUARY 2002
Forgoing Future Military Compensation, Rehabilitation Scheme payments and Application of Section 59P of Part IIIC of the Veterans' Entitlements Act 1986
Purpose |
This Departmental Instruction amends the guidelines relating to section 59P, Part IIIC of the Veterans' Entitlements Act 1986 (VEA). Subject to satisfying eligibility and payability provisions, the policy will allow a person to receive an income support pension if he/she forgoes a Military Compensation & Rehabilitation Scheme compensation payment in order to gain payment under Part II or Part IV of the VEA. |
Background |
The Part IIIC compensation recovery provisions commenced to apply on 1 January 1995 to service pension and 30 March 1995 to ISS. Part IIIC compensation recovery provisions may apply if a service pensioner or income support supplement (ISS) recipient is under pension age and he/she receives compensation paid wholly or partly in respect of lost earnings or lost capacity to earn (economic loss). Section 59P (refer attachment A) provides the Commission with the power to require a person to take action to obtain compensation. Failure to take such action may result in non-payment of income support pension. Since the compensation recovery provisions commenced the guidelines (refer attachment B) relating to section 59P have mirrored the equivalent policy relating to section 1166 of the Social Security Act 1991 (SSA). To date the guidelines have required a person to take action to obtain compensation unless such action was unlikely to result in the award of compensation. |
Issue |
Following review of a case that involved the forgoing of MCRS payment, legal advice was provided regarding the interaction between MCRS payments under the Safety, Rehabilitation and Compensation Act 1988 (SRCA) and the guidelines relating to section 59P of the VEA. Section 43 of the SRCA (refer attachment C) contains a statutory right for certain persons who may be eligible for a payment under Part II or Part IV of the VEA to apply to Comcare to “request that an amount of compensation under this Act to which the person is, or may become, entitled be not paid to, or for the benefit of, the person”. That is, the person can forgo the MCRS payment in order to receive disability pension payable under the VEA. The guidelines in relation to section 59P were therefore in conflict with the SRCA. |
Legal Advice |
The conclusion contained in the Legal Advice was that the Repatriation Commission should “adopt a policy whereby Part IIIC of the VEA does NOT operate on future payments of benefits that would otherwise have been payable to a person under the SRCA where the person has made a cessation request under section 43 of the SRCA”. |
Commission Decision |
On 14 January 2002 the Repatriation Commission approved the new section 59P policy in relation to future MCRS payments recommended by the Legal advice (CM 5295 Attachment D refers). The Commission also endorsed the pre-existing guidelines (attachment B refers). It is proposed that the following additional criterion be added to the current guidelines relating to section 59P of the VEA. A person will not be required to obtain compensation under section 59P of the VEA: Where the veteran uses his/her statutory right contained in subsection 43(1) of the Safety, Rehabilitation and Compensation Act 1988 (SRCA) to apply to Comcare to request that an amount of Military Compensation & Rehabilitation Scheme (MCRS) payment be forgone in favour of a payment under Part II or Part IV of the VEA.
The amendment to the guidelines is limited in its scope to the cessation of future MCRS payments under subsection 43(1) of the SRCA. |
Effective Date |
The Commission policy will generally apply effective from the date that the Commission decision was made, that is 14 of January 2002. Any veteran who may have been adversely affected by the application of 59P to forgone MCRS payments should be identified and his/her case reviewed retrospectively from the date that section 59P was applied. |
Target Population |
It is anticipated that the number of cases affected by this change will remain very low. |
Other Action |
It is important to ensure that MCRS claimants/recipients who may be affected by Part IIIC compensation recovery provisions are made aware of this beneficial policy when they are considering their MCRS compensation and income support options. Policy documentation such as that contained in CLIK will be amended. |
Roger Winzenberg
Branch Head
Income support
8 February 2002
Attachment A
Section 59P, Part IIIC of the Veterans' Entitlements Act 1986
Division 2—Enforcement of compensation rights
59P Commission may require person to take action to obtain compensation
(1)If:
(a)a person is receiving a compensation affected pension; and
(b)the person or the person's partner is entitled or may, in the Commission's opinion, be entitled to compensation; and
(c)the person or the partner has not taken:
(i)any action to claim or obtain the compensation; or
(ii)any action that the Commission considers reasonable to claim or obtain the compensation;
the Commission may require the person or the partner to take the action specified by the Commission.
(2)If:
(a)a person is eligible for a compensation affected pension; and
(b)the person or the person's partner is entitled or may, in the Commission's opinion, be entitled to compensation; and
(c)the person or the partner has not taken:
(i)any action to claim or obtain the compensation; or
(ii)any action that the Commission considers reasonable to claim or obtain the compensation;
the Commission may require the person or the partner to take the action specified by the Commission.
(3)Even though a person has entered into an agreement to give up the person's right to compensation, the Commission may form the opinion that the person may be entitled to compensation if the Commission is satisfied that the agreement is void, ineffective or unenforceable.
(4)For the purposes of subsection (3), a person enters into an agreement to give up the person's right to compensation if the person:
(a)enters into an agreement to waive the person's right to compensation; or
(b)enters into an agreement to withdraw the person's claim for compensation.
(5)The action specified by the Commission is to be the action that the Commission considers reasonable to enable the person to claim or obtain the compensation.
(6)If, under subsection (1), the Commission requires a person who has been granted a pension to take action to claim or obtain compensation, the pension is not payable to the person unless the person complies with the requirement.
(7)If, under subsection (1), the Commission requires the partner of a person who has been granted a pension to take action to obtain or claim compensation, the pension is not payable to the person unless the partner complies with the requirement.
Attachment B
OPERATION OF SECTION 59P VEA- REQUIREMENT TO PURSUE COMPENSATION AWARD: AMENDED CLIK VERSION
(nb The compensation recovery chapter is currently being reformatted to comply with CLIK standards. With the exception of the newly added information relating to MCRS offsetting the policy mirrors the DFACS policy)
Section 59P allows the Repatriation Commission to require a client to pursue and obtain compensation where it is indicated, from information provided that the client or the partner is entitled, or may be entitled, to compensation.
Payment of a Compensation Affected Pension (CAP) can be withheld where a client or partner fails to take action to claim or obtain compensation.
It is important to note however that the requirement to pursue compensation is subject to Repatriation Commission discretion. The client or partner could be considered to have taken reasonable action to claim compensation by:
- lodging a claim with the employer or insurer; or
- engaging a solicitor to commence legal proceedings; or
- seeking legal advice as to whether a claim for compensation can be successfully pursued; or
The following Repatriation Commission (CM 5295 of 14 January 2002 refers) approved examples may, depending on the full circumstances of each case be acceptable reasons for a client or partner not claiming compensation:
- there is no enforceable claim for compensation; or
- the veteran uses his/her statutory right contained in subsection 43(1) of the Safety, Rehabilitation and Compensation Act 1988 (SRCA) to apply to Comcare to request that an amount of Military Compensation & Rehabilitation Scheme (MCRS) payment be forgone in favour of a payment under Part II or Part IV of the VEA.
- the accident occurred many years ago and is now statute barred; or
- legal proceedings are required but the client or partner cannot afford to engage a solicitor and is not qualified for legal aid; or
- the injuries sustained will not result in the client or partner suffering a loss of wages, salary or loss of earning capacity; or
there is a question of significant contributory negligence. This may occur where the client or partner caused his or her own injury, for example the client was intoxicated whilst on duty.
Attachment C
Section 43 of the Safety, Rehabilitation and Compensation Act 1988
Sect 43 -Certain persons may request cessation of compensation payments
(1) Where compensation under this Act is payable to, or for the benefit of, a person who is:
(a)a member of the Forces, or a member of a Peacekeeping Force, for the purposes of Part IV of the Veterans' Entitlements Act 1986; or
(b)a veteran who has, on or after the day on which the Military Compensation Act 1994 commences, rendered operational service for the purposes of Part II of the Veterans' Entitlements Act 1986; or
(c)a dependant of such a member or veteran;
the person may, by notice in writing to Comcare, request that an amount of compensation under this Act to which the person is entitled, or may become entitled, not be paid to, or for the benefit of, the person.
(2) Where Comcare receives a request by a person:
(a)an amount of compensation under this Act that is payable to, or for the benefit of, the person at the time of that receipt, being an amount to which the request relates, ceases to be so payable; and
(b)an amount of compensation under this Act that would, but for this section, become payable to, or for the benefit of, that person during the period when the request is in force, being an amount to which the request relates, does not become payable.
(3) A person who has made a request may, by notice in writing to Comcare, revoke the request.
(4) The revocation of a request:
(a)has effect on the receipt of the notice of revocation by Comcare; and
(b)does not revive any entitlement to an amount of compensation that had ceased to be payable, or had not become payable, as a result of the making of the request.
(5) A person who is under a legal disability may not make or revoke a request but a request may be made or revoked on his or her behalf by another person who Comcare is satisfied represents the first-mentioned person's interests.
(6) A request or revocation made on behalf of a person under a legal disability shall, for the purposes of this section, be taken to have been made by that person.
Attachment D
Military Compensation & Rehabilitation Scheme Compensation Payments and Income Support Compensation Recovery Provisions
Repatriation Commission Decision CM5295 of 14 January 2002
The Commission had before it a submission from the Compensation and Support Division seeking:
- its agreement to use its discretionary powers not to enforce the provisions of section 59P, Part IIIC of the Veterans' Entitlements Act 1986 (VEA) to certain forgone Military Compensation and Rehabilitation Scheme (MCRS) compensation payments; and
- its endorsement of that approach retrospectively in cases where a veteran may have been adversely affected by the application of section 59P to forgone MCRS payments since 1995.
2.The Commission NOTED the legal advice that the current practice in relation to section 59P is in conflict with section43 of the Safety, Rehabilitation and Compensation Act 1988.
3.The Commission AGREED to use its discretionary powers under section 59P, Part IIIC of the VEA not to enforce those provisions. It ALSO AGREED to the retrospective application of this approach to veterans adversely affected by the application of section 59P to forgone MCRS payments since 1995.
4.The Commission REQUESTED that the position in relation to recovery of treatment costs under the Treatment Principles be further clarified.