C36/2004 AUTOMATION OF CLEARANCES BETWEEN DVA & CENTRELINK

Introduction

The purpose of this Departmental Instruction is to advise of the changes being made to further automate the Clearance Process between DVA and Centrelink.

Background

With the implementation of the Defence Force Income Support Allowance (DFISA) the Clearance Process was partially automated with the transmission of data relating to grants and variations of DP and WWP from DVA to Centrelink. However, Centrelink were unable to automate the return of Clearance data at that time.

Following the implementation of DFISA, DVA and Centrelink have continued to work together to facilitate further automation of the Clearance Process. The changes being made will see the existing manual process largely replaced by automated transmissions of data between the two agencies.

Effective Date

These changes will be implemented at DVA and Centrelink on the weekend of 4/5 December 2004.  At the same time other changes will be made to the Centrelink data transmissions to notify DVA of personal details for partners eligible for DFISA.  State Office action now required for these cases is outlined in the Stateline entitled Automated Transmission from Centrelink of Personal Details for Partners Eligible for DFISA being sent out at the same time as this Stateline.

System and Procedural Changes

In summary the following changes are to be made:

• Transmission of clearance data from DVA to Centrelink to now include data relating to grants of Age Pension, Service Pension, and Income Support Supplement via secure link.
• Data relating to Centrelink adjustment amount will be transmitted from Centrelink to DVA via secure link.
• Data relating to DVA offsetting of arrears will be transmitted from DVA to Centrelink via secure link.
• Automatic holding of DP, WWP, AP, SP, and ISS arrears.
• Automatic offsetting of arrears and release of remaining arrears.
• Automatic generation of letter to veteran.
• Changes to DFISA daily reports.

Implementation

The implementation date for these changes will be Monday 6 December 2004.  Transmissions from this date will contain the new information, although any outstanding paper clearances at that date will still need to be fully actioned to finalisation in accordance with current procedures.

More Information

The detail on these changes and their effect on state processes is contained in Attachment A.

References

For further information on the changes made to the Clearance Process with the initial implementation of DFISA refer to:

• Stateline – 1 September 2004 - Revised Clearance Process and Centrelink liaison following the implementation of the Defence Force Income Support Allowance (DFISA).

For further information on the recent changes to Centrelink's debt recovery policy refer to:

• Stateline – 17 November 2004 – Changes to Centrelink Debt Recovery Action.

Training

The changes being introduced basically automate what are now manual processes without changing those processes to any extent.  Therefore, apart from reading and understanding the attached detail of changes, little training is required.  Information hook-ups are being arranged with DFISA Contact Officers so that clearance staff can have the changes explained to them by Project Team members and have the opportunity to clarify any aspects not fully understood.

Further changes

It was originally hoped that streamlined clearance monitoring support would also be introduced with this automation of the clearance process.  Unfortunately, complexities in getting agreement on the data exchange component with Centrelink have meant that other components have had to be delayed.  However, it is still intended to examine the development of monitoring support in the new calendar year.

Contact Officer

If you wish further clarification this Stateline, please contact Michelle Taylor, Project Officer, New System Development, Income Support on 17589 or by email to michelle.taylor@dva.gov.au.  Any management issues should be addressed to Ron Mildenhall Director Income Support New Systems Development.

Purpose

The purpose of this Attachment is to detail the changes being made to further automate the Clearance Process between DVA and Centrelink.

Overview

The following changes are being implemented on 6 December 2004:

• Transmission of clearance data from DVA to Centrelink relating to grants of Income Support pensions (ie Age Pension, Service Pension, and Income Support Supplement)
• Automation of Centrelink adjustment amount from Centrelink to DVA
• Automation of data relating to DVA offsetting of arrears from DVA to Centrelink
• Automated holding of Disability Pension, War Widows' Pension, Age Pension, Service Pension, and Income Support Supplement arrears
• Automatic offsetting of arrears
• Automated Advice letter for release of arrears
• Changes to daily DFISA reports

Further Changes

Work has also commenced on automated recording of Centrelink DFISA debts in DMRS and online tracking of the Clearance Process.

As further details become available advice will be provided to State Offices on these changes.

Overview

The changes to be made to the Clearance Process will see the automation of what is currently a manual process. These changes will result in minimal user intervention.

Diagram

The following diagram depicts the new automated clearance process:

Example

The following example illustrates the automated clearance process for a grant of Disability Pension where the client has been previously matched between DVA and Centrelink.

Step

Action

1

Disability Pension is granted on Monday.

2

At 4.00am on Tuesday DVA transmits data relating to the DP grant (ie. type of pension granted, level of DP, date of effect, etc)

3

At 6.00pm on Tuesday Centrelink transmits adjustment amount

4

At 9.00pm on Tuesday DVA:

• offsets adjustment amount from arrears;
• releases remaining arrears; and
• Advice will be printed in State Office - State Office to envelope and send to client following morning.

5

Wednesday morning - advice printed out in State Office

5

At 4.00am on Wednesday DVA transmits amount offset from DVA arrears to Centrelink

6

Thursday – client receives balance of arrears.

Delays in Automated Clearances

Whilst for the majority of cases the automated clearance process is expected to take only a few days to finalise, there will be some exceptions because of current system limitations at Centrelink.

Delays may be experienced when Centrelink are unable to process the adjustment automatically. If, for example, the adjustment is to be applied prior to a Centrelink Statutory Increase, the case needs to be processed manually by Centrelink staff at Revesby before the adjustment amount can be transmitted to DVA.

In addition, if the client is reported out for manual matching at Centrelink short delays may be experienced whilst the client is being matched.

Overview

With the implementation of DFISA, DVA commenced transmitting Part A clearance data to Centrelink for grants and variations of Disability Pension and War Widows Pension. In December DVA will commence transmission of Part A data for grants of Age Pension, Service Pension and Income Support Supplement.

Automated Income Support Clearances

Currently when Service Pension, Age Pension or Income Supplement is granted at DVA a manual clearance is sent to Centrelink advising them of the grant, the effective date and the rate of pension paid. Centrelink uses this information to cancel mutually exclusive income support benefits. Following this Centrelink advises DVA of overpayments arising from such grants.

In future grants of Service Pension, Age Pension and Income Support Supplement will trigger a transmission containing relevant data to Centrelink.  The data to be transmitted will include:

• Type of Pension being granted; and
• Date of effect of grant.

Following discussions with Centrelink it has been agreed that DVA will not transmit the rate of pension. As DVA income support pensions are mutually exclusive with Centrelink income support pensions the amount is irrelevant. Any amount of DVA income support pension will result in a cancellation of Centrelink income support pension.

Change to Existing Procedures

Manual clearances will no longer be required for the following:

• Grants of Service Pension
• Grants of Age Pension

• Grants of Income Support Supplement.

No changes to automated Clearances for DP and WWP

With the implementation of DFISA the automated transmission of data between DVA and Centrelink replaced the manual clearance process for:

• Grants of Disability Pension
• Variation of Disability Pension
• Grant of War Widows Pension.

This process will continue to be automated and therefore manual clearances are not required for any of these types of grants or variations.

Manual Clearances

Manual clearances will still be required for the following:

• MCRS
• MRCA
• VCES
• Commencement of payments of Foreign WWP.

Manual clearances are also required when the grant/variation processed through PIPS or CCPS does not reflect the date of grant of the pension.

In these circumstances an automated clearance will be generated to Centrelink, however the date will simply be the date entered in PIPS or CCPS.

For these cases decision-makers must contact the Revesby Centrelink  Clearance Site immediately and advise them of the correct date of eligibility. A manual clearance should also be faxed to Revesby for confirmation of the details.

Foreign WWP

Automated clearances will not be generated when commencing payment of foreign War Widows Pension. For these cases if the client indicates that they are in receipt of Centrelink benefits current manual clearances should be arranged by the person commencing the payment of Foreign War Widows Pension as they would now.

Overview

Grants of DVA pensions (or variations of Disability Pension) can result in overpayments of Social Security pensions or benefits. Centrelink advises DVA of overpayments arising from such grants and where possible DVA offsets these amounts from held arrears.

With the automated transmission of clearance data relating to grants/variations of DP and grants of WWP from DVA to Centrelink that was introduced with DFISA Phase 1, Centrelink continued to advise of these overpayment or adjustment amounts via faxed manual clearances.

From 6 December 2004 Centrelink will advise the adjustment amount via automated transmission across the secure link.

Automated transmission of Adjustment Amount

For every transmission of clearance data from DVA to Centrelink a corresponding transmission will be returned advising of the adjustment to Social Security pensions or benefits.

If the adjustment amount is zero the transmission will record the adjustment amount as $0.00.

This data will be used by the system to automatically offset held arrears at DVA.

Changes to Existing Procedures

For the vast majority of cases DVA will no longer receive manual faxes from Centrelink advising of the adjustment to Social Security pension or benefits arising from grants or variations of DVA pensions.

Overview

Following advice from Centrelink of adjustments to Social Security pensions or benefits DVA, where possible, offsets that amount from any held arrears arising from the grant of the DVA pension.

DVA has until now advised Centrelink of the amount offset via a manual faxed clearance. However with the further automation of the Clearance Process this information will also be transmitted automatically via secure link.

Automated Transmission of Offset Amount

For every transmission from Centrelink that includes an adjustment amount a corresponding transmission will be sent from DVA advising of the amount offset from DVA arrears.

If the transmission from Centrelink advises of nil adjustment, DVA will not transmit data in return, as there is no adjustment amount and Centrelink will not expect a transmission.

Changes to Existing Procedures

For the majority of cases DVA will no longer advise Centrelink of amounts offset from DVA arrears for Centrelink adjustments via manual faxed clearances.

Overview

To further facilitate the automation of the Clearance Process any relevant arrears generated will be held pending the outcome of the Clearance Process.

Prior to the implementation of DFISA, State Office staff could determine when to send clearances and when to hold arrears. With the implementation of automated transmission of clearances and the automation of adjustments etc, it has been decided to send a clearance in all cases and withhold arrears in all cases to eliminate any possibility of arrears being released when there is a Centrelink adjustment.

Arrears to be defaulted to Held

When SP, AP, ISS, WWP, or DP is granted or DP is varied, PIPS and CCPS will now automatically default to holding the arrears.

At the time of the grant the default can be overridden and arrears set to be released. However, it is recommended that the default only be overridden when it is definitely known that the client is not in receipt of Centrelink pensions or benefits. It should be noted that in the majority of cases it is anticipated that the client will receive their arrears within 3-4 working days. Therefore holding arrears and allowing the clearance process to go through should not unduly affect the pensioner.

New Message in PIPS & CCPS

When the Arrears screen is accessed in PIPS a message will be displayed advising the user that an automated clearance is in progress for that case. A similar message will appear in CCPS.

New Message in PIPS & CCPS, continued

The message will alert users to the fact that if they wish to release arrears the client will have to repay any overpayment of Centrelink pension or benefit directly to Centrelink.

Changes to Existing Procedures

Staff processing SP, AP, ISS, WWP and DP claims (including Applications for Increase) through PIPS and CCPS will no longer have to determine if arrears should be held, as the system will automatically default the arrears to “held”.

Given the time taken for most automated clearances to be finalised there should be no need to override the default in the majority of cases.

It is recommended that the default be overridden to allow the release of arrears only where it is definitely confirmed that the client is not in receipt of Centrelink pension or benefits and the client is experiencing financial hardship.

Overview

Following advice from Centrelink of adjustments to Social Security pensions or benefits DVA, where possible, offsets that amount from any held arrears arising from the grant of the DVA pension.

State Office staff have been manually deducting the Centrelink adjustment from the held arrears and then releasing the remainder to the client. With the transmission of the adjustment amount from Centrelink to DVA, the system will now be able to perform this task.

Automatic Offsetting

DVA will apply the adjustment amount transmitted from Centrelink automatically to any held arrears. This will mean that in the majority of cases there will be no manual offsetting of arrears in IPS.

If the client has multiple arrears (eg. DP arrears and SP arrears) the arrears will not be offset until DVA receives transmissions for all adjustment amounts from Centrelink. Only when DVA has received transmissions for DP adjustment and SP adjustment will offsetting occur and adjustments will occur at the same time.

Outstanding Centrelink adjustment

Where the adjustment amount transmitted by Centrelink cannot be fully recovered from DVA arrears, no further action will be taken. Recent changes to Centrelink debt recovery policy prevent DVA from recovering outstanding Centrelink adjustments from ongoing DVA pensions without a notice from Centrelink to do so.

In light of this, DVA will transmit the amount offset to Centrelink and Centrelink will determine appropriate action to recover any outstanding adjustments. Only when DVA receives a notice from Centrelink will recovery plans be raised.

Example

The following example demonstrates the process of automatic offsetting of arrears where the client has been previously matched between DVA and Centrelink.

Step

Action

1

Veteran is granted Service Pension and arrears of $500 are automatically held

2

DVA transmits advice of grant to Centrelink

3

Centrelink transmits adjustment amount of $400 to DVA

4

DVA automatically offsets $400 from held arrears and automatically releases balance of $100 to veteran and advises veteran of arrears

5

DVA transmits advice to Centrelink that $400 offset from held arrears

Partner Centrelink adjustment

There will be different action taking place depending upon whether a veteran's partner is matched or unmatched. The following table illustrates the two possible processes when a grant of DVA pension generates an overpayment/adjustment of Centrelink pension/benefit for the veteran's partner.

Step

Action

1

Veteran is granted DVA pension and arrears are held

2

DVA transmits advice of grant to Centrelink

3

Centrelink transmits advice of adjustment amount for veteran.

If transmission records....

Then.....

Matched partner (ie partner recorded at DVA and Centrelink)

• DVA will continue to hold arrears pending receipt of transmission for partner's adjustment amount
• When transmission received for partner's adjustment, DVA will automatically offset adjustments for both veteran and partner and release any balance of arrears to veteran
• DVA will send an advice to the veteran regarding their arrears
• DVA will send two separate transmissions advising Centrelink of amount offset for veteran and amount offset for partner from veteran's arrears

Unmatched partner (ie partner not recorded at DVA)

• DVA will automatically offset adjustment for veteran and continue to hold arrears
• DVA will send transmission advising Centrelink of amount offset for veteran's adjustment
• Centrelink will send manual faxed clearance for partner's adjustment amount
• DVA will manually offset partner's adjustment from veteran's held arrears
• DVA will return manually faxed clearance to Centrelink advising of amount offset for partner's adjustment.
• DVA will manually send standard letter to veteran regarding arrears and offsetting

Partner Centrelink adjustment, continued

Note:  If the partner is entitled to DFISA, Centrelink will transmit personal details and DVA will manually create the client. However, this process is separate from the automated clearance process. A separate Stateline is being issued advising of procedures for manual creation of unmatched partners.

It should be noted that creating the client at DVA will not result in Centrelink transmitting the adjustment amount at a later time. The adjustment amount can only be transmitted at the time at which the primary payment at Centrelink is adjusted. If the client is not matched between the two agencies at this time Centrelink systems cannot transmit the adjustment amount for that client. Hence the manual faxed clearance for the partner's Centrelink adjustment.

Manual releasing of arrears – Warning Message

The facility to release arrears manually through IPS will remain. There may be a number of reasons why arrears should be released prior to the completion of the automated clearance process including:

• Client is experiencing financial hardship;
• Centrelink have not transmitted the adjustment amount and arrears have been held for at least 42 days.

When accessing the arrears in “Authorised Automatic Assessments” in VIEW/IPS a warning message will be displayed. The message will alert the user to the fact that an automated clearance is in progress and the client will have to repay any overpayments of Centrelink pension or benefit directly to Centrelink.

If arrears are released manually the user will need to send the appropriate IS Standard Letter to the client to advise them of the amount of arrears being released to them.

New Advice Letter

When arrears are released through the automated process, a new Advice letter will be automatically generated. This advice letter will inform the client the total amount of arrears, the amount of any Centrelink adjustment, and the balance to be paid to the client.

This advice letter will only be triggered when arrears are offset and released automatically. If arrears are released manually through IPS the user will need to send the appropriate IS Standard Letter to the client.

Changes to Existing Procedures

Held arrears will be automatically offset by the adjustment amount transmitted by Centrelink and any balance will be automatically released to the client. This process will replace the existing manual process of releasing arrears through IPS. The exception to this will be where a partner, not recorded at DVA, incurs an overpayment of Centrelink pension or benefit. In these circumstances, the veteran's adjustment will be offset automatically, whilst the partner's adjustment will be offset manually (as per current procedures).

When arrears are released automatically an advice letter will be automatically generated. This will replace the existing IS Standard Letter for automated cases. For those cases where arrears are released manually through IPS users will have to send the relevant IS Standard Letter.

Overview

With implementation of DFISA Phase 1 a suite of new reports were introduced to monitor transmissions from DVA to Centrelink. These reports will be revised for the full automation of clearances and will include data relating to SP, AP, and ISS grants.

The reports have been renamed so that they more appropriately reflect the new data content. The renamed reports will  be as follows:

• DP Information Held – to be renamed “Clearance Data Held”
• DP Information Deleted -  to be renamed “Held Clearance Data Deleted”
• DP Information Sent – to be renamed “ Clearance Data Transmitted to Centrelink”.

“Clearance Data Held” Report

The “Clearance Data Held” Report records cases in which the data relating to the grant of DVA pension is being held pending matching of the client between DVA and Centrelink.

When DP is granted/varied, or SP, AP, ISS, or WWP is granted, if the client does not have a CRN recorded at DVA, the client's personal details will be transmitted to Centrelink and the grant data held pending the outcome of this process. Centrelink will attempt to match the client.

If a match is obtained Centrelink will transmit a CRN to DVA, at which time the data relating to the grant of DVA pension will be deleted from the Held file and transmitted to Centrelink.

If the client is not matched at Centrelink the transmission from Centrelink will be blank where the CRN would normally appear. At this time the data relating to the grant of DVA pension will be deleted from the Held file and any held arrears will be released.

“Held Clearance Data Deleted” Report

The “Held Clearance Data Deleted” Report will record cases where the matching process has been complete.

The following messages will be displayed in the report:

If Centrelink transmit....

Then the message displayed will be...

A blank CRN for the client

“UIN with blank CRN received from Centrelink. Not matched.”

A CRN for the client

“UIN with CRN received from Centrelink. Matched, release entries.”

“Clearance Data Transmitted to Centrelink” Report

The “Clearance Data Transmitted to Centrelink” report will record cases in which the data relating to the grant of DVA pension has been transmitted to Centrelink.

When SP, AP, ISS, WWP, DP is granted or DP is varied and a CRN is recorded at DVA for the client the data will be transmitted the same day as the grant/variation.

If a CRN is not recorded at DVA, the data will be held pending matching. If a CRN is transmitted from Centrelink the data will be transmitted upon receipt of the CRN.

“Held Arrears” and “Outstanding Held Arrears” Reports

Outstanding clearances can be tracked using the “Held Arrears” and “Outstanding Held Arrears” Reports. Given that arrears will be held for all grants of AP, SP, ISS, WWP, DP and variations of DP all cases should be tracked using these reports.

The only cases that will not appear on these reports will be the cases where the default has been overridden to release arrears at the time of grant/variation or where arrears have been released prior to the automated clearance process being finalised. These cases should only include clients where it is definitely known they are not currently in receipt of Centrelink pension/benefit or those for which the clearance process has not been finalised in at least 42 days.

For those clients not currently in payment of Centrelink pension/benefit the clearance process will confirm that that is the case and hence Centrelink will not be transmitting an adjustment amount.

For those cases for which the clearance process has not been finalised in at least 42 days, DVA will transmit nil offset amount to Centrelink. Prior to releasing arrears the client must be advised that any overpayment arising at Centrelink will have to be repaid directly to Centrelink. Therefore the automated process will result in Centrelink contacting the client for repayment/recovery of any outstanding adjustment.

Online Tracking of Transmissions

Work is under-way to provide online tracking of Centrelink transmissions. It is anticipated that staff will be able to view the status of the automated clearance process through VIEW/IPS.

Following consultation with State Office representatives, development will commence to provide this facility.