At Step 6 the delegate is deciding whether the amount of compensation already received for all accepted conditions exceeds the maximum weekly permanent impairment (PI) compensation amount payable under the MRCA.
Step 6 asks the delegate to add the following amounts together:
If the total of these amounts:
Note: Please see Payment Rates [2] in the Compensation and Support Reference Library for more information.
Note: Please see the Compensation Claims Procedures [3] manual for more information about the procedural aspects of Step 6.
Conversion of DRCA lump sums
The DRCA amounts are converted to a current lump sum value (by multiplying by the ratio of the current value for maximum DRCA section 24 payment to the value when the lump sum payment was made) and each lump sum converted to a periodic payment by dividing by an age-based number provided by the Australian Government Actuary for this purpose. The age to be used in applying this age-based number is the age that the person would have been on their next birthday at the time the DRCA lump sum was paid. The converted amount is indexed annually (on 1 July) using the indexation factor calculated under section 404 of the MRCA.
Conversion of VEA DCP
At this step, delegates must use the percentage rate of DCP at the date the client lodged their MRCA PI claim, however use the current rate of payment applicable at the date of MRCA PI determination. This is to take into consideration any rate increases to the DCP percentage that have occurred between the time of MRCA PI claim and MRCA PI determination. It is important to note that at this step the delegate is not taking into consideration any increase in DCP percentage as a result of a new claim or an Application for Increase (AFI) under VEA occurring after the MRCA PI claim date. As DCP is a fortnightly amount, the delegate will halve the DCP to find the weekly equivalent rate.
Example: A veteran lodges a MRCA PI claim on 1/01/2022. At that date, the veteran is receiving DCP at 30% of the General Rate under VEA. On 01/03/2022, the veteran lodges an Application for Increase under VEA and their DCP is increased to 40% of the General Rate on 01/05/2022, with effect from 1/02/2022. At the date of determination of MRCA PI on 01/10/2022 and at Step 6, the delegate is taking into consideration the DCP percentage payable at the date of MRCA PI claim, that is, 30% DCP. However, the dollar amount taken into consideration is 30% DCP at the rate payable at the date of MRCA PI determination, on 01/10/2022.
Relevant definitions
MRCA determination means: ‘in relation to a person, means the determination by the Commission of the degree of impairment suffered by the person as a result of a compensable condition under the Act’.
DRCA accepted condition means: ‘in relation to a person, means the person’s injury for which there is liability to pay compensation under the DRCA’.
VEA percentage means: 'the amount of disability pension payable under the VEA for the conditions referred to in Step 1 as at the date of the MRCA claim expressed as a percentage of the General Rate at that date’.
Links
[1] https://clik.dva.gov.au/user/login?destination=comment/reply/18869%23comment-form
[2] http://auth-clik.dvastaff.dva.gov.au/compensation-and-support-reference-library/payment-rates
[3] http://auth-clik.dvastaff.dva.gov.au/compensation-claims-procedures/mrca-permanent-impairment-procedures/transitional-provisions-interaction-between-mrca-vea-and-drca
[4] https://www.legislation.gov.au/Details/F2020L00296
[5] http://auth-clik.dvastaff.dva.gov.au/military-compensation-mrca-manuals-and-resources-library/actuary-tables-used-age-adjusting-lump-sum-payments