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18/1992 Pooled use of Entitlements - Widows-ers with own Entitlement


Central Office Instruction

Instruction No. 18

Date of Effect: 1 October 1992




The purpose of this Instruction is to provide advice on how to treat applications from widows/widowers who also qualify on their own service.


Training accidents which have resulted in the deaths of a number of servicemen have highlighted circumstances where widows, in addition to qualifying as widows, also have their own qualifying service. Widows/widowers who are eligible on the basis of their own service as well as their spouses' service should receive the benefits to which they would have been entitled had their spouse not predeceased them, i.e. that they should be allowed to "pool" the entitlements.


It has been decided that two Certificates of Entitlement (each for a maximum $25,000) may be issued to a widow/widower where that person is both an eligible person in his/her own right and the widow/widower of an eligible person provided, of course, that the widow/widower has not remarried at the time of determining eligibility on the widow/widower status.

Where a widow/widower of an eligible person is also an Australian soldier, that person should be informed of the dual entitlements and be invited to apply on two application forms. Two file numbers are to be allocated with appropriate cross references. If approved, two separate but cross referenced Certificates of Entitlement should be issued.

It is important that the widow/widower is counselled fully on her/his entitlements because the chance to obtain dual assistance is a once-only opportunity. If she/he decides to take only one advance (i.e. an advance is obtained on the person's own eligibility either as an Australian soldier or as a widow/widower), she/he is unable to obtain the other advance at a later date because she/he has not been a borrower merely because she/he was a joint borrower with her/his spouse and became such a borrower on the basis that the spouse was an eligible person.

Where a married couple has pooled their entitlements and one of them dies, the survivor may receive two further advances. Both further advances would be for the limits of the loans at the time they were discharged.

Categories of widow/widowers

There are three categories of widows documented in COI 11. These should now be interpreted as applying equally to widowers. The three categories are:

  1. where an advance, taken out as joint tenants, was discharged prior to the death of the person on whose service the advance was granted;
  2. where an advance, taken out as joint tenants, was current when the person on whose service the advance was granted died. The widow/widower would then become the sole borrower through survivorship without using her/his own entitlement; and
  3. where an advance was taken out by the now deceased spouse in his/her sole name.

Initial advances

The first two categories of widow/widower are specifically excluded from the definition of "initial advance" in ss.4(1) of the Act by the clause '... merely because the person is or was a joint purchaser or borrower ...'. Therefore, ss.4(1) of the Act permits the approval of initial advances to widows/widowers in categories i and ii.

For category iii widows/widowers, at present, a property which is subject to a DSH loan is allowed to remain in the estate. Under these circumstances, a subsidy would continue to be paid without affecting the widow's/widower's entitlement. In other words, it is not necessary to transfer the property to a surviving spouse for a subsidy to continue. If the property and the loan are not transferred, no entitlement is lost. Therefore, a widow/widower who is also an Australian soldier would be entitled to up to $50,000 on the next home acquisition. Widows/widowers in category iii would need to use her/his entitlement to transfer the property to her/his name as beneficiary.

Further advances

If the property and the loan is transferred, only the limit of the late spouse's loan is available for portability purposes. There is no entitlement to another initial advance. Therefore, a widow/widower might not get the maximum benefit which she/he may have otherwise obtained if the estate was handled differently.

Where a client seeks a further advance, the normal provisions relating to further advances are to be applied. Care should be exercised to establish whether the widow/widower has remarried since the original Certificate of Entitlement was issued - a remarriage voids the status of widow/widower. Where a widow/widower has remarried, only the subsidised loan granted in respect of that person's own service may be taken into account for determining the amount of the further advance.

Second qualifying period of service

It is important to note that the issue of two concurrent Certificates of Entitlement to widows/widowers applies only as a result of the decision to allow pooling of entitlements earned as a result of service by more than one person. It does not extend, for example, to an individual person who has completed more than one period of qualifying service. Individual persons with multiple periods of service fall outside the definitions of "initial advance" and "further advance" and, therefore, it is irrelevant to consider them for pooled use of entitlements earned by different persons.

DSH staff commitment

The area of pooled entitlements is of particular concern to prospective clients. It is also an area which has political sensitivity. Therefore, staff are asked to provide particular assistance to the client group canvassed in this Instruction.. Applicants must be advised of all matters which may have a financial impact on them or which may influence their decision to make a financial commitment. Service to the client and the duty of care should be borne in mind at all times.

General Orders

These changes will be incorporated in the revised GOs which are currently in preparation.



1 October 1992