MCRI No. 2 Amdt 9

Military Compensation Scheme

Safety Rehabilitation and Compensation Act 1988 (SRC Act)

SUBJECT

INDEXATION OF NWE UNDER SUB-SECTION 8(9B) FROM 1 JULY 2003

STATUTORY COMPENSATION RATES EFFECTIVE FROM AND INCLUDING 1 JULY 2003

SUB-SECTION 16(6) KILOMETRE RATE

Purpose

The purpose of the MCRI is to advise Military Compensation and Rehabilitation Service (MCRS) Delegates of changes in the rate to be applied to ex employees' NWE and in the statutory benefit rates of compensation payable under the SRC Act.  Please note that the increased compensation rates will only be effective from and including 1 July 2003.

Background

Normal Weekly Earnings (NWE)

Sub-section 8(9B) of the SRC Act authorises determining authorities such as the MCRS to increase NWE for ex-employees of the Commonwealth (including members and former members of the Australian Defence Force - ADF) by reference to a prescribed index.  Regulation 5 of the Safety, Rehabilitation and Compensation Regulations 2002 prescribes the Australian Bureau of Statistics (ABS) Wage Cost Index (WCI — total hourly rates of pay - excluding bonuses/Australia/all industries/all occupations) for this purpose.

On 1 July each year determining authorities will increase NWE for ex employees based on any increase in the WCI for the year ending in the previous December quarter.  This MCRI should be read in conjunction with MCRI 20 although further amendments to the MCRI 20 WCI rates will be contained in MCRS 2.

Statutory Rates

Section 13 of the Act provides for indexation to be applied to relevant amounts specified in subsection 17(3), 17(4), 17(5), 18(2), 19(7), 19(8), 19(9), 24(9), 27(2), 29(1), 29(3), 30(1) and 137(1) on 1 July each year.  The indexation is based on variations in the Consumer Price Index (CPI) for the previous December quarter.  The relevant change for the December quarter 2002 as published by the Australian Bureau of Statistics, reflected an increase of 3.0 per cent in the All Groups Consumer Price Index.

NOTE — The relevant CPI percentage increase is different to, and should not be confused with, the ABS Wage Cost Index (WCI) referred to above.  The two will often not be the same.

Policy Advice

WCI

The ABS issued the WCI for the year ending 31 December 2002 on 19 February 2003.  The percentage increase in the index for the period was 3.4 per cent.  The MCRS should increase NWE for ex members of the ADF who are affected by this provision by this percentage effective from 1 July 2003.

STATUTORY RATES OF COMPENSATION

Sub-section	Benefit	1 July 2002 Rate $	1 July 2003 Rate $
17(3)	Death lump sum	190,595.65	196,313.52
17(4)	Death lump sum	190,595.65	196,313.52
17(5)	Death dependant child	63.52	65.42
18(2)	Funeral expenses	4,399.68	4,531.67
19(7)	Incapacity - employee	320.83	330.45
19(8)	Incapacity - prescribed person	79.43	81.81
19(9)	Incapacity - dependant child	39.70	40.89
24(9)	Permanent impairment	127,063.76	130,875.67
27(2)	Non-economic loss - impairment component	23,824.47	24,539.20
	- non-economic loss	23,824.47	24,539.20
29(1)	Household services	317.65	327.18
29(3)	Attendant care services	317.65	327.18
30(1)	Redemption “ceiling”	79.43	81.81
137(1)	Redemption “ceiling”	79.43	81.81

ADDITIONAL DEFENCE ACT 1903 BENEFITS FOR ADF MEMBERS AND DEPENDANTS WHERE APPLICABLE
Determination under the Defence Act 1903	Additional Death Benefit	229,024.45 less the amount payable under the SRC Act.	235,895.18 less the amount payable under the SRC Act.
	Dependant Child	57,256.12	58,973.80
	Severe Injury Adjustment	229,024.45 less the amount payable under Sections 24 and 27 of the SRC Act.	235,895.18 less the amount payable under Sections 24 and 27 of the SRC Act.
	Dependant Child	57,256.12	58,973.80
	Financial Advice	1,145.18	1,179.54

SUB-SECTION 16(6) KILOMETRE RATE FOR TRAVEL TO OBTAIN MEDICAL TREATMENT IN PRIVATE MOTOR VEHICLE

Further amendments to MCRI 2 will sometimes contain details of a change to the amount of compensation which can be paid under sub-section 16(6) of the SRC Act where an injured employee reasonably incurs expenses in travelling by private motor vehicle to obtain reasonable medical treatment for the compensable injury or condition.  Such changes are made under Regulation by the Minister who has portfolio responsibility for the operations of Comcare; currently the Minister for Employment and Workplace Relations.

On this occasion, we understand that an increase in the mileage rate from the current 42 cents per kilometre is still being considered by Comcare.  No decision has at this stage been made as to whether any increase to the rate should take effect from 1 July 2003.  If such a decision is made, MCRS staff can expect to be advised of any rate change soon after advice is received in National Office.

Amendment Action

Remove MCRI 2 (Amendment 7) and replace with MCRI 2 (Amendment 8).

Any enquiries concerning the information contained in this MCRI should be directed to Mr John M Vidler on (02) 6289 4851 or by e-mail at john.vidler@dva.gov.au or to Mr Craig Boyd on (08) 9366 8571 or by e-mail at craig.boyd@dva.gov.au

Mark Travers

Director

Policy and Procedures

23 May 2003

References

COMCARE Jurisdictional Policy Advice Number 2003/05 (Indexation of NWE) and 2003/01 (Indexation of Benefits under section 13 effective 1 July 2003).