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Permanent Impairment

Legislative Authority

Safety, Rehabilitation and Compensation Act 1988
Part II, Division 4


Stated Current Purpose/Intent

To provide lump sum compensation benefits to those who suffer a permanent impairment as a result of an injury or disease for which there is a liability to pay compensation under the SRCA.  In some cases, lump sum compensation can also be awarded to the dependants of a member or former member of the ADF who is severely injured.


Current Eligibility Criteria

Members and former members of the ADF who have suffered a permanent impairment as a result of an injury or disease due to service rendered between 1 December 1988 and 30 June 2004 inclusive, may be entitled to a lump sum payment of compensation under the SRCA.


Date of Introduction

1 December 1988


Original Purpose/Intent

To compensate members, former members of the ADF, or their dependants, for the effects of an injury or disease for which the Commonwealth has accepted liability and which has resulted in a minimum of 10 per cent whole person impairment (WPI), or 5 per cent WPI in certain instances.



  1. Additional benefits under the Defence Act 1903, known as a “severe injury adjustment” (SIA) apply only to injuries or diseases sustained or suffered between 7 April 1994 and 30 June 2004 inclusive and only where the compensable injury or disease results in at least 80 per cent WPI and has suffered an injury to the brain or spinal cord resulting in paraplegia, hemiplegia, quadriplegia, an organic brain syndrome, blindness or a condition of similar effect.
  2. Generally, if a WPI is less than 10 per cent, no lump sum compensation can be paid. However, there are some exceptions to this requirement, such as for loss of hearing, loss of fingers or toes, and loss of taste or smell, where only 5 per cent WPI is required.
  3. If a pension is payable under the VEA because of disability or death due to the same injury, this will be reduced to offset any other compensation paid for the same reason. If a VEA pension has already been granted, past pension payments may be taken into account when calculating a lump sum payment under the SRCA.
  4. If a member or former member is permanently impaired after 1 December 1988, there may be an entitlement to a lump sum up to $243,329.42 under the SRCA. Different rates apply for injuries prior to that date.
  5. Where an accepted condition results in payment of SIA, up to an additional $75,642.17 is payable under the Defence Act 1903, together with an additional amount of $81,858.18 for each dependent child.
  6. Children of those who suffer “severe injuries”, or of those who die in compensable circumstances, have access to the counselling services of the Veterans' Children Education Scheme.
  7. It is important to note that these payments are not “settlements” of a claim and may be payable in addition to ongoing entitlements to compensation in respect of vocational or other rehabilitation, medical and other treatment and incapacity for work.
  8. Financial advice of an amount up to $1,594.94 is also available for a member who suffers a severe injury.
  9. The above rates of payment are applicable as at 1 July 2014 and are indexed annually on 1 July.
  10. There are offsetting provisions for pensions paid under the VEA for death or disability.


Significant Changes in Criteria or Purpose Since Introduction


The first edition of the Approved Guide was tabled in 1989.  Section 28 of the SRCA establishes the Approved Guide and mandates its usage in the assessment of compensation for permanent impairment and non-economic loss. The Guide to the Assessment of the Degree of Permanent Impairment is an Approved Guide.  It is set out in two parts: Part 1 is for claims made under the SRCA by employees who are not members of the ADF.  Part 2 is used to assess Defence-related claims for current and former members of the ADF.


With effect from 1 October 2001, the Safety, Rehabilitation and Compensation and Other Legislation Amendment Act 2001 (No 144/2001), amended S 25(4) and added S25(5) to provide that a reassessment for hearing loss can be made where there is a subsequent increase in the degree of a compensated hearing loss of 5 per cent (previously 10 per cent) binaural hearing loss (2.5 per cent WPI) or more.  This beneficial provision may be applied only in relation to claims for hearing loss resulting from an injury that occurred on or after 1 October 2001.


The second edition of the Guide was released in 2005 and applies to claims received prior to 1 December 2011.


The current edition of the Guide, Edition 2.1 was released in 2011 and applies to claims received on or after 1 December 2011.