The SRCA recognises that some members of the Defence Force may have an entitlement to compensation under the SRCA and also under the VEA or the MRCA. However, in such cases, S115 of the SRCA, Division 5A in Part II of the VEA and S74 of the VEA come into operation to prevent double payment of compensation.
Before a payment of PI compensation is made, the delegate must ensure that all relevant clearances have been received.
The general presumption is that where a veteran is in receipt of a VEA Disability Compensation Payment (DCP), a clearance should be sent to the Offsetting and Manual Payments team to determine whether offsetting applies. Where the veteran is receiving a VEA Disability Compensation Payment at the Intermediate Rate, Special Rate (TPI) or Temporary Special Rate a clearance is always required.
Compensation offsetting under the VEA is the process of reducing one compensation payment in recognition of another compensation payment for the same incapacity. Incapacity means the overall effect of an injury or disease. The same injury or disease accepted under the VEA may be medically diagnosed in a different way when accepted under the DRCA. If the DRCA condition contributes to the same incapacity as your VEA condition, then offsetting applies. The underlying principle behind these provisions is that a person should not be compensated twice for the same incapacity, when a person in a similar circumstance can only receive one source of compensation if only eligible from that source. It is up to the Offsetting and Manual Payments team to determine whether the incapacity is the same.
The only situation where a clearance is not required where a client is in receipt of a general rate VEA Disability Compensation Payment, is when it is abundantly clear that compensation will not be paid for the same incapacity under the DRCA as under the VEA. The following examples demonstrate this situation:
Examples of where a clearance is not required
1. The veteran has hearing loss and tinnitus accepted under the VEA and lumbar spondylosis accepted under the DRCA. The veteran is in receipt of 10% DCP under the VEA for hearing loss and tinnitus. The veteran claims permanent impairment (PI) compensation for lumbar spondylosis under the DRCA and the delegate decides the veteran is eligible for PI.
2. The veteran has PTSD accepted under the VEA, sprain of the right knee and dislocation of the left shoulder accepted under the DRCA. The veteran is in receipt of 50% DCP under the VEA for PTSD. The veteran claims PI compensation for the right knee condition under the DRCA and the delegate decides the veteran is eligible for PI.
3. The veteran has osteoarthritis of the left knee and right knee and non-melanotic neoplasm of the skin accepted under VEA and an amputation of the right ring finger accepted under the DRCA. The veteran is in receipt of 40% DCP under the VEA for osteoarthritis of the left knee and right knee and non-melanotic neoplasm. The veteran claims PI compensation for the finger amputation under the DRCA and the delegate decides the veteran is eligible for PI.
As a general rule, in the majority of cases a clearance will be required from the Offsetting and Manual Payments team where the veteran is in receipt of a VEA DCP and subsequently is eligible for DRCA PI. Where the veteran is in receipt of DCP at above the general rate, a clearance will always be required. The above three examples demonstrate situations where it is absolutely clear compensation will not be paid for the same incapacity under the DRCA as under the VEA. In these cases the delegate should place a file note in ISH to demonstrate they have considered offsetting, however are satisfied beyond doubt that offsetting is not required. If there is any doubt, the delegate should defer to the general rule, as above, and request a clearance before proceeding with the DRCA PI claim.
Further information about Offsetting can be found in the Compensation Offsetting Guidelines [3]. 2.7 [4] of this guide discusses offsetting for conditions with different diagnosis with the same incapacity.
For the process to be followed from clearance to payment see 10.7 of the SRCA Permanent Impairment Handbook.
A dual entitlement is unlikely to arise in the following cases:
A dual entitlement may exist in the following cases:
It should be noted that while S115 of the SRCA and S74 of the VEA operate to prevent double payment of compensation in respect of the same injury, no similar arrangements are in place with respect to SIA payments made under the Defence Act.
It should be noted that while S115 of the SRCA and S74 of the VEA operate to prevent double payment of compensation in respect of the same injury, no similar provisions exist in the SRCA to prevent payments both under Ss24, 25 and 27 of the SRCA and the Social Security Act 1991. For this reason, PI payments do not need to be cleared with Centrelink.
Both the SRCA and the VEA have legislative provisions covering offsetting of benefits.
Under the SRCA S115 notes that certain payments made under the VEA are recoverable against payments made under the SRCA. The relevant sections of the VEA include S30C and S74.
Should a SRCA condition be aggravated by MRCA service (i.e. eligible service after
1 July 2004) then the aggravated component is considered to be a MRCA condition e.g. medical treatment comes under the MRCA. For more information, see Chapter 12 of the MRCA Policy Manual.
The operation of Chapter 25 of GARP M allows for injuries already compensated under the SRCA to be offset against the overall impairment and resultant payment under the MRCA PI provisions. The decision in James v Military Rehabilitation and Compensation Commission [2010] FCAFC 95 endorses the operation of this chapter. For more information, see Chapter 5 of the MRCA Policy Manual.
More ? [10]
Links
[1] https://clik.dva.gov.au/user/login?destination=node/20758%23comment-form
[2] https://clik.dva.gov.au/user/login?destination=node/20822%23comment-form
[3] https://clik.dva.gov.au/compensation-and-support-reference-library/compensation-offsetting-guidelines
[4] https://clik.dva.gov.au/compensation-and-support-reference-library/compensation-offsetting-guidelines/2-sources-other-compensation/27-different-medical-labels-diagnosis-same-incapacity
[5] https://clik.dva.gov.au/user/login?destination=node/20834%23comment-form
[6] https://clik.dva.gov.au/user/login?destination=node/20941%23comment-form
[7] https://clik.dva.gov.au/user/login?destination=node/20716%23comment-form
[8] https://clik.dva.gov.au/user/login?destination=node/20783%23comment-form
[9] https://clik.dva.gov.au/book/export/html/20758#tgt-msrca_pi_hbk_ftn45
[10] https://clik.dva.gov.au/book/export/html/20758#tgt-msrca_pi_hbk_ftn46
[11] https://clik.dva.gov.au/military-compensation-mrca-manuals-and-resources-library/policy-manual/ch-12-transitional-provisions
[12] https://clik.dva.gov.au/book/export/html/20758#ref-msrca_pi_hbk_ftn45
[13] https://clik.dva.gov.au/military-compensation-mrca-manuals-and-resources-library/policy-manual/ch-5-permanent-impairment
[14] https://clik.dva.gov.au/book/export/html/20758#ref-msrca_pi_hbk_ftn46