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2.5 S27 Compensation for Non-Economic Loss

Last amended 
17 March 2023

Section 27 sets out when the Commonwealth is liable to pay compensation for non-economic loss (NEL) and how this compensation is to be calculated.    

Key Points

  • Section 27 of the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) provides that where an injury results in permanent impairment (PI) and compensation is payable under section 24, the Commonwealth is liable to pay additional compensation for NEL suffered by the veteran as a result of that injury or impairment.
  • The degree of NEL is assessed under Part 2 of Division 2 of the Guide to the Assessment of the Degree of Permanent Impairment – Edition 2.1 (the ‘PI Guide’) taking into account the ‘Principles of Assessment’ in Part 2 of the PI Guide.
  • The Commonwealth is only liable to pay NEL where compensation is payable under section 24. NEL is not payable in respect of interim PI compensation paid under section 25 of the Act. This is discussed further in Chapter 4.3.3 of the DRCA PI Handbook.
  • A veteran is entitled to NEL compensation in respect of each ‘injury’. As such, each injury must be assessed separately under section 27 and delegates must determine the NEL that a veteran suffers as a result of the specific injury being assessed.
  • NEL scores in relation to one injury cannot be ‘offset’ against the NEL scores determined for a separate injury.
  • NEL is a subjective concept of the effects of the impairment on the veteran’s life. It includes pain and suffering, loss of amenities of life, loss of expectation of life and any other real inconveniences caused by the impairment. While two veterans may have equal impairment ratings it would not be unusual for them to receive different ratings for NEL because of their different lifestyles.

Further Information

  • For more information about the key concepts relating to NEL, see Chapter 3.5.
  • For more information about the calculation and investigation of NEL compensation with examples, see Chapter 5.7.
  • For more information about the NEL Questionnaire and Tables, see Chapter 5.8.