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8.1 Background

8.1.1Legislation providing for the recovery of overpayments between the Department of Veterans' Affairs (DVA) and Centrelink has been in place since 1 September 1987. This means that any overpayments made under the legislative authority of one department (including those previously written off) can be recovered from current and future payments by the other department.

8.1.2Sub-sections 1228(1) and (2) in the Social Security Act 1991 (SSA) provide that Centrelink can recover an overpayment by means of deductions from a current Centrelink customer, if an amount that was paid under the Veterans' Entitlement Act 1986 (VEA) should not have been paid. However, under SSA rules a deduction cannot be applied to a Centrelink customer's payment for recovery of another person's debt.

8.1.3Similarly, section 205 VEA provides that DVA can recover an overpayment by means of deductions from a current DVA client, if an amount which was paid under the SSA should not have been paid.

8.1.4Section 205AA VEA provides that where a Centrelink customer is retrospectively granted a pension by DVA, or has their DVA pension rate increased retrospectively, any amount of the Centrelink payment which would not have been payable during the period, if the DVA payment had then been payable, is recoverable.