C07/1999 DETERMINATION OF MEMBER OF A COUPLE - Discretion to treat client as not a member of a couple

Introduction

The purpose of this Departmental Instruction is to provide guidance on the use of Section 5R(3) of the Veterans' Entitlements Act 1986.  Section 5R(3) provides the discretion to treat a person who is a member of a couple as not being a member of a couple.

Section 5R(3)

Section 5R(3) states:

“Person may be treated as not being a member of a couple

(3)The Commission may determine, for any special reason, that a person who is a member of a couple is not to be treated as a member of a couple for the purpose of this ACT.”

Background

This instruction identifies issues relating to the determination of a member of a couple; including which cases and under what conditions this discretion would be appropriate.  It is imperative, in these cases, for consistency across the States.

Partnered assessments prior to October 1985

Prior to October 1985, if a veteran was a member of a couple and the veteran's partner was not receiving a service pension or social security pension or benefit, the veteran could receive the single rate of service pension.  The rate was calculated using the couple's combined income/ assets.  However, the veteran's rate of service pension could not exceed twice the partnered (married) rate at which the service pension would be paid to the veteran if the partner was receiving a service pension or social security pension or benefit.

1995 Budget changes

Under changes announced in the 1995-96 Budget, the rate of service pension for a member of a couple was limited to the partnered (married) rate.  This applied even where only one member is eligible for, or chooses to receive the pension.

From 1 October 1995 any new assessment where a person is a member of a couple is calculated on combined income and the partner rates apply, except for illness separated couples or under exceptional circumstances.

This change was designed in part to ensure that DVA meets its obligation for equitable treatment of its clients by treating all members of a couple in the same way.

Application of S5R(3)

Section 5R(3) gives discretion to treat a member of a couple as not a member of a couple under special circumstances.

The discretion should only be exercised in strictly limited situations.  In general, it is intended to be exercised where the married couple does not enjoy the pooling of resources that usually occurs in a marital relationship.

The discretion to regard a veteran as not a member of a couple should be exercised only where a full consideration of all the circumstances relevant to the individual's case would make it unjust or unreasonable not to do so.

Special circumstances

It is not possible to predict all of the situations in which it would be necessary to exercise the discretion.  However, the following considerations should always be borne in mind:

• The reasons for exercising the discretion should be ones that relate to the nature of the marital relationship;

• Financial hardship is not, of itself, a sufficient reason for exercising the discretion; and

• The discretion will usually only be exercised if the marital situation is unusual, uncommon or abnormal; the whole of the circumstances of the case should be examined before considering whether it is reasonable to exercise the discretion.

Examples

Two examples of cases in which discretion would be appropriate are attached at the end of this instruction.

Other exceptions:

There may be other circumstances requiring examination, such as where the affairs of a married couple have been arranged so that the access of one partner to the other's income is limited.  In examining such cases, great care should be taken to ensure that the situation has not been contrived to circumvent the purposes of the Act.

Limited access

In 'limited access' cases, the situation should be investigated in terms of whether the couple could be considered to be living separately and apart on a permanent basis.

In considering 'limited access' cases, many factors require examination.  Some of these are outlined below.

Legal restrictions

Are there any legal restrictions on the transfer of funds from overseas?  Some overseas countries have monetary controls that prevent the transfer to Australia of some or all of a person's funds.  The precise details of those controls should be investigated if a case of this nature arises.

Excess funds

Does the overseas partner have sufficient excess funds to send to Australia?  It is possible that the overseas partner may only have sufficient funds to support himself or herself.  In this situation, it may not be reasonable to expect him or her to support the partner in Australia.  In all cases, the income and assets of the overseas partner should be examined in detail.

Can the situation be altered?

Does either of the parties have power to alter the situation?  If so, are they taking reasonable steps to do so?

Particular attention should be given to whether one partner is taking, or could reasonably be expected to be taking, steps to gain greater access to the other partner's income (e.g. by seeking a court order).

Is the situation beyond the parties' control?

Has the situation arisen beyond the control of either partner, or as an unintended consequence of either partner's actions?

Where a couple has married overseas and the situation has not been contrived to obtain welfare entitlements, it may be accepted that the current situation is not an intended consequence of the partner's actions.  By contrast, if either partner has knowingly contributed to the situation (e.g. one partner goes overseas without a sufficiently compelling reason, leaving the partner in Australia with insufficient funds), there would be considerably less justification for exercising discretion.

Inquiries

Any question regarding this DI should be directed to the Policy Section in National Office:

• Jeanette Ricketts, Director                (02) 6289 6085

• Elizabeth Quinn, Project Officer       (02) 6289 6078

Example case 1:

Partner overseas

A veteran whose service pension was reduced to the married rate, but immigration procedures prevent his wife from residing with him in Australia.  Although the couple is married, the VEA precludes payment to the wife as she is not in Australia nor is she an Australian resident (as defined by section 5G(1)).  The wife cannot be in Australia due to failing medical tests and immigration refers her for further tests.  The veteran advised the department of his marriage and as a consequence of that notification, the veteran's service pension was reduced to the married rate.

Consideration to be given

The primary consideration in this case is whether the partner in Australia is deprived of the income support of the overseas partner.  In general, all relevant factors should be listed and weighed.  Without being exhaustive, the following factors should be considered:

• Has the situation arisen beyond the control of either partner or as an unintended consequence of the partner's actions?

• Does either party have power to alter the situation and, if so, are they taking reasonable steps to do so?

Rationale for case 1:

Partner overseas

In the example outlined above, the wife has failed medical tests required for immigration and this is preventing her from entering Australia.  Arrangements have been made for further tests and they are taking reasonable steps to alter the current situation.

The veteran and his wife are not enjoying the economies of scale that couples enjoy when they reside together.  Therefore, this case would be grounds for application of the discretion contained in S5R(3).  It would be considered appropriate to treat the married veteran in Australia as unmarried while his partner is overseas.

Example case 2:

Non-Australian partner

The case is an application for service pension by an allied veteran who is currently receiving disability pension (dp).

The veteran travelled to Singapore and married an Indonesian national.  The veteran advised DVA of his marriage and as a result his payment was reduced from the single rate to the married rate.  The wife has recently arrived in Australia and has obtained a temporary visa pending a decision on her application for permanent resident status in Australia.

The spouse in ineligible for any Centrelink benefit due to the two year waiting period.

DFaCS policy

Under the Social Security Act 1991 a two year waiting period applies to newly arriving residents before they become eligible for certain pensions, allowances or benefits from the Department of Family and Community Services (DFaCS).  To ensure that in the circumstances where one member of a couple is not eligible for pension or benefit because of the waiting period, the couple do not experience financial hardship, DFaCS policy is to treat the pensioner as 'not a member of a couple'.

Rationale for case 2:

Non-Australian partner

An agreement exists for DVA to mirror DFaCS policy in paying certain pensioner partners of people serving the two-year residency waiting period at the single rate, by invoking the power of the Commission under section 5R(3) to treat them as 'not a member of a couple'.  Further, in deciding which cases are to be assessed, a hardship test is applied in which any DP received is to be counted as income.

In view of the circumstances in Case 2 it is appropriate to treat the veteran as 'not a member of a couple' in terms of Section 5R(3) of the VEA.