Various decisions of the AAT and of the Federal Court of Australia have discussed what are the powers of the AAT in the compensation matters it deals with.

It would be fair to say that the weight of relevant decisions on this issue indicates that the AAT exercises the powers and discretions of the original decision maker; in this context, the RD.

If the RD did not address a matter in the reviewable decision, then the AAT does not have the discretion to consider that matter. To all intents and purposes, the AAT 'stands in the shoes' of the RD and decides the issue(s) which were before the RD and no more.

For example, a matter might come before a RD which relates to an employee's entitlement to weekly incapacity for work benefits. However, when considering that matter, the RD might conclude that liability to pay compensation has in fact ceased and that there is no entitlement to compensation benefits (including incapacity benefits) after a certain date.

In such a case, natural justice would demand that the employee is afforded an opportunity to provide evidence to support continuing liability. Assuming that the RD was satisfied that it was justifiable to cease liability to pay compensation, a reviewable decision might be issued finding that the Commonwealth is not liable to pay compensation to the employee after a certain date. In such a case, the RD has appropriately gone beyond the scope of the original decision in finding that liability has ceased.

Were the matter to become the subject of an application to the AAT, it would be open to the AAT to consider the correctness of the decision to cease liability to pay compensation. If the AAT concluded that the decision to cease liability was incorrect, it would also be open to the AAT to make a finding accordingly and to remit the matter to the MRCC for determination of the employee's actual entitlements under the SRC Act. Arguably, however, it would not be open to the AAT to make any findings regarding the employee's actual entitlement to benefits, except possibly the incapacity for work benefits to which the original (primary) decision related.

Ultimately, the AAT has a responsibility to come to the correct and/or preferable decision in relation to a particular matter that it is asked to consider.