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2016-2017-2018
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
VETERANS' AFFAIRS LEGISLATION AMENDMENT (OMNIBUS)
BILL 2018
EXPLANATORY MEMORANDUM
(Circulated by authority of the Minister for Veterans' Affairs,
The Honourable Darren Chester MP)
Table of Contents
Outline and Financial Impact i
Statement of Compatibility iii
Veterans' Affairs Legislation Amendment (Omnibus) Bill 2018
Short title 1
Commencement 1
Schedules 1
Dictionary 2
Schedule 1 Claims by Chief of Defence Force on behalf persons 3
Schedule 2 Obtaining information 5
Schedule 3 Exempt lump sums 9
VETERANS' AFFAIRS LEGISLATION AMENDMENT (OMNIBUS)
BILL 2018
OUTLINE AND FINANCIAL IMPACT
The Explanatory Memorandum to the Veterans' Affairs Legislation Amendment (Omnibus)
Bill 2018 (the Bill) provides a description of amendments to the Bill being made.
Schedule 1 - Claims by Chief of Defence Force on behalf of persons
The amendments proposed to be made by Schedule 1 would enable the Chief of the Defence
Force (CDF) to make a claim for liability for a current serving Australian Defence Force
member where they have given consent for the CDF to make the claim on their behalf for a
service injury or disease.
The Military Rehabilitation and Compensation Act 2004 (MRCA) prescribes the
requirements for a person to make a claim for liability for compensation under the Act.
Section 320 of the MRCA enables a person to make a claim for liability for a service injury
or disease. Generally the person affected by the service injury or disease must make the
claim, however, in certain limited circumstances a claim may be made by another person on
their behalf.
This measure would provide another avenue for claiming, which may streamline the claims
process in some instances and potentially facilitate earlier acceptance of liability. This will be
particularly beneficial to veterans accessing services some time after the injury was sustained
or the disease contracted but where the claim was established contemporaneously.
Schedule 2 - Obtaining information
The amendments proposed to be made by Schedule 2 would align the power of the Military
Rehabilitation and Compensation Commission (MRCC) to obtain information under the
Safety, Rehabilitation and Compensation Act (Defence-related Claims) Act 1988 (DRCA)
and the MRCA when determining a claim.
Currently, under section 151 of the DRCA, the MRCC may require certain information from
the Secretary of the Department of Defence, the Secretary of the Department of Veterans'
Affairs and the CDF. The proposed amendments would enable the MRCC to require
information from any Commonwealth, State or Territory Departments and authorities, and
other persons such as current or former treatment providers and other third parties in addition
to the Secretary of the Department of Defence, the Secretary of the Department of Veterans'
Affairs or the CDF.
This measure aims to resolve veterans' claims more quickly by obtaining complete
information from third parties in a timely manner and deliver more consistent determinations
by the MRCC.
i
Schedule 3 - Exempt lump sums
The amendments proposed to be made by Schedule 3 would amend the Veterans'
Entitlements Act 1986 (VEA) to ensure that exempt lump sum determinations made by the
Secretary of the Department of Social Services (DSS) will apply as exempt lump sums from
the income test that applies to DVA income support clients.
The Repatriation Commission often implements separate, yet identical, exempt lump sum
determinations for payments that have already been exempted under the Social Security Act
1991 made by the Secretary of DSS. This places an unnecessary burden on DVA which could
be removed by allowing exempt lump sum determinations made by DSS to apply to DVA
income support clients where the exemption is consistent with the VEA.
This change will mean impacted veterans do not have to wait for the DVA instrument to be
made gain the benefit of the exemption.
Financial Impact
None.
ii
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
VETERANS' AFFAIRS LEGISLATION AMENDMENT (OMNIBUS) BILL 2018
The Veterans' Affairs Legislation Amendment (Omnibus) Bill 2018 is compatible with the
human rights and freedoms recognised or declared in the international instruments listed in
section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.
Schedule 1 - Claims by Chief of Defence Force on behalf of persons
Overview of the Schedule
The MRCA prescribes the requirements for a person to make a claim for liability or
compensation under the Act. Section 320 of the MRCA enables a person to make a claim for
liability for a service disease or injury. Generally the person who is affected must make the
claim, however, in certain limited circumstances a claim may be made by another on their
behalf.
The amendment will enable the Chief of the Defence Force (CDF) to make a claim for
liability on behalf of a serving Australian Defence Force (ADF) member where the member
has given consent for the CDF to make the claim on their behalf. This measure is anticipated
to streamline the claims process and reduce delays in the acceptance of liability.
These amendments commence on the day after this Act receives the Royal Assent.
Human rights implications
Right to social security
The schedule engages the right to social security under Article 9 of the International
Covenant on Economic, Social and Cultural Rights (ICESCR). Article 9 of the ICESCR
states "States Parties ... recognize the right of everyone to social security, including social
insurance". General Comment 19 by the Committee on Economic, Social and Cultural
Rights sets out the essential elements of the right to social security, including "States parties
should ... ensure the protection of workers who are injured in the course of employment or
other productive work".
Conclusion
The amendment proposed to be made by Schedule 1 is consistent with the right to social
security as it promotes the access to social security by improving the claims process. The
amendment will enable the CDF to make a claim for initial liability on the behalf of a current
ADF member where the member has given consent for the CDF to make the claim on their
behalf for a service injury or disease. The establishment of liability is required in order to
obtain compensation. This would create an alternative mechanism for a claim of liability to
be made for current ADF members.
iii
Schedule 2 - Obtaining of Information
Overview of the Schedule
The amendments proposed to be made by Schedule 2 would align the powers of the MRCC
to obtain information under the DRCA and MRCA in determining a claim.
Currently under section 151 of the DRCA, the MRCC may require, by written notice,
information to be provided from the Secretary of the Department of Defence, the Secretary of
the Department of Veterans' Affairs or the CDF. The written notice must specify the period,
the document or information (or both) that is in the possession, custody or control of that
person that is required. In addition, the written notice must be given without delay.
The amendments would enable the MRCC to give a written notice requiring information
from any other Commonwealth, State or Territory Departments, agencies such as the
Australian Taxation Office, Medicare or Centrelink, and persons such as current or former
treatment providers or other third parties.
The amendments to section 151 of the DRCA would ensure the "Obtaining information'
provisions are similar to those in section 406 of the MRCA and sections 128 and 129 in the
VEA.
These amendments commence on the day after this Act receives the Royal Assent.
Human rights implications
Right to social security
The schedule engages the right to social security under Article 9 of the International
Covenant on Economic, Social and Cultural Rights (ICESCR). Article 9 of the ICESCR
states "States Parties ... recognize the right of everyone to social security, including social
insurance". General Comment 19 by the Committee on Economic, Social and Cultural
Rights sets out the essential elements of the right to social security, including "States parties
should ... ensure the protection of workers who are injured in the course of employment or
other productive work".
Conclusion
This Schedule is compatible with the right to social security as it will enable the MRCC to
access information that may substantiate a veteran's claim for compensation under the
DRCA. This will be particularly useful where the veteran or their dependant is unable to
obtain the information required to support their claim which may adversely affect the MRCC
in making a fair and equitable determination.
This amendment will also lead to consistent determinations for compensation being made as
the MRCC's ability to obtain information under the DRCA will be similar to its power to
obtain information under the MRCA.
Article 17 of the International Covenant on Civil and Political Rights (ICCPR) prohibits
arbitrary or unlawful interference with an individual's privacy, family, home or
iv
correspondence. The right to privacy includes respect for informational privacy, and
measures allowing the disclosure or personal information engages the right to privacy. This
amendment is permissible as it is not arbitrary and is necessary and proportional to the
outcome sought. The requirement to obtain information from third parties is in connection to
a claim made by a person (or a dependant of a person or their estate) for liability and/or a
claim for compensation under the Act. The MRCC needs to establish whether the person is
eligible to claim and whether that claim is based on an injury or disease that is related to
defence service or whether the injury or disease has been aggravated due to defence service
prior to making a determination. In some cases a person, a dependant or the estate of a
person may experience difficulty in sourcing the information required to establish a claim.
Where this occurs the MRCC may require information directly from the source which will
overcome this limitation.
Article 14(3) of the ICCPR engages the right against self-incrimination and is subject to
permissible limitations. Proposed section 151AA of the Bill comes within a permissible
limitation against the privilege of self-incrimination as the section is reasonable, necessary
and proportional to the objective. The proposed section 151AA will strengthen the
military-related compensation scheme and the information relied on in consideration of a
person's claim. The immunity to self-incrimination in section 151AA contains an exception
to proceedings under sections 137.1 and 137.2 of the Criminal Code Act 1995 (Cth) where a
person provides false and misleading information. This exemption is appropriate as it will
ensure the integrity of the military-related compensation scheme by ensuring those that
deliberately provide false and misleading information in response to a notice are held
accountable for this and the detrimental impact this will have on a person's claim for liability
and/or compensation.
v
Schedule 3 - Exempt Lump Sums
Overview of the Schedule
The amendments proposed to be made by Schedule 3 would amend the VEA to allow certain
exempt lump sum determinations made by the Secretary for the Department of Social
Services (DSS) to apply to Department of Veterans' Affairs (DVA) income support clients,
where the determination is consistent with DVA legislation and policy.
The determination specifies an exemption of certain lump sums from the income test that
apply to DVA income support clients. Where a DVA client on an income support payment
and receives a lump sum that is exempt from the income test, the income test is calculated
without taking that lump sum into account.
Currently, the Repatriation Commission often implements separate, yet identical, exempt
lump sum determinations for payments that have already been exempted under the Social
Security Act 1991 (SSA) by the Secretary of DSS. Replicating the determination places an
unnecessary burden on DVA that would be removed by allowing exempt lump sum
determinations made by the Secretary for Social Services to apply to DVA income support
clients where the exemption does not contradict the VEA and is consistent with DVA
legislation and policy.
The amendment would improve administrative practices as the exempt lump sum
determination enacted by the DSS would automatically apply under the VEA to DVA clients.
These amendments commence on the day after this Act receives the Royal Assent.
Human rights implications
Right to social security
The schedule engages the right to social security under Article 9 of the International
Covenant on Economic, Social and Cultural Rights (ICESCR). Article 9 of the ICESCR
states "States Parties ... recognize the right of everyone to social security, including social
insurance". General Comment 19 by the Committee on Economic, Social and Cultural
Rights sets out the essential elements of the right to social security, including "States parties
should ... ensure the protection of workers who are injured in the course of employment or
other productive work".
Conclusion
This Schedule is compatible with the right to social security as it will ensure there is no
discrimination between DSS and DVA clients in the assessing of a relevant payment and the
applicable exempt lump sum determinations.
The amendment will also remove any risk that a gap in time may exist with two separate
departments required to make separate determinations designed to give the same effect. The
power of the Repatriation Commission to make a lump sum determination under the VEA
will be retained.
vi
VETERANS' AFFAIRS LEGISLATION AMENDMENT (OMNIBUS)
BILL 2018
Short Title Clause 1 provides that the Act is the Veterans' Affairs Legislation
Amendment (Omnibus) Act 2018.
Commencement Clause 2 sets out the commencement date of the provisions of the Act.
For convenience the commencement information is replicated below.
Schedules Clause 3 provides that legislation that is specified in a Schedule to this
Act is amended or repealed as set out in the applicable items in the
Schedule concerned, and any other item in a Schedule to this Act has
effect according to its terms.
Commencement information
Column 1 Column 2 Column 3
Provisions Commencement Date/Details
1. Sections 1 to 3 and The day this Act receives the Royal Assent.
anything in this Act not
elsewhere covered by this
table
2. Schedules 1 to 3 The day after this Act receives the Royal
Assent.
1
This Explanatory Memorandum uses the following abbreviations:
ADF means Australian Defence Force
CDF means the Chief of the Defence Force
Defence means the Department of Defence
DRCA means the Safety, Rehabilitation and Compensation (Defence-related Claims) Act
1988
DSS means the Department of Social Services
DVA means the Department of Veterans' Affairs
MRCA means the Military Rehabilitation and Compensation Act 2004
MRCC means the Military Rehabilitation and Compensation Commission
SSA means the Social Security Act 1991
VEA means the Veterans' Entitlements Act 1986
2
Schedule 1 - Claims by Chief of Defence Force on behalf of
persons
Military Rehabilitation and Compensation Act 2004
Background
The amendments proposed to be made by Schedule 1 would amend the MRCA to enable the
CDF to make a claim for liability on behalf of a current serving ADF member where they
have given consent for the CDF to make the claim on their behalf for a service injury or
disease.
This amendment will not create a positive requirement for the CDF to make a claim on behalf
of a current serving member. The current provisions in subsections 320(1) to (3) prescribe
the requirements for a person to make a claim for liability or compensation under the Act and
these provisions are not amended. Section 320 of the MRCA enables a person to make a
claim for liability for a service disease or injury. Generally, the person who is affected must
make the claim, however, in certain limited circumstances prescribed in subsection 320(2)
and (3) a claim may be made by another on their behalf. This amendment will provide
another avenue for claiming liability, which may streamline the claims process and in some
instances and potentially facilitate earlier acceptance of liability.
The amendment will enable the CDF to make a claim for liability on behalf of a serving
Australian Defence Force member where that member consents to the CDF making the claim.
Further, this amendment may remove some of those difficulties where a claim is made some
time after the injury is suffered or the disease is contracted as liability may have been
established soon after the injury or disease occurred.
Notes on Clauses
Item 1 would insert "(except a claim made by the Chief of the Defence Force on behalf of the
person)" in subsection 319(3) after "in respect of a person".
This would serve as an exception to the requirement under section 319 for the Commission to
give a copy of the claim that has been made for the acceptance of liability to the CDF. The
exception is necessary as it would not be required for the Commission to send a copy of a
claim to the CDF where the CDF has made a claim on behalf of a person. This amendment is
consequential to the amendment made at item 2 below.
Item 2 would insert new subsections 320(2A) and (2B) after subsection 320(2).
New subsection 320(2A) will enable a member of the ADF to approve the CDF to make a
claim for liability for a service injury or a service disease on their behalf. A person who
sustained the injury or contracted the disease will retain their ability to make a claim under
paragraph 320(2)(a). New subsection 320(2A) creates an additional method for a claim for
liability to be made.
3
New subsection 320(2B) would clarify that where the person approves of the CDF to make a
claim on their behalf that the CDF is not required to make the claim. This new subsection
will ensure the operation of new subsection 320(2A) is discretionary and that the CDF is not
required to make a claim for liability on behalf of a member of the ADF.
Where the CDF does not make a claim of behalf of a member of the ADF under new section
320(2A) the member, or another person specified under section 320, may make a claim for
liability under Division 2, Part 1 Chapter 7.
Item 3 is an application provision which will provide that the amendment applies to a person,
who sustains a service injury or contracts a service disease, on or after the commencement of
this provision.
Commencement
The amendments in Schedule 1 commences the day after Royal Assent.
4
Schedule 2 - Obtaining Information
Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988
Background
The amendments proposed to be made by Schedule 2 would align the power to obtain
information under the DRCA, MRCA and VEA when determining a claim.
Currently, under section 151 of the DRCA, the MRCC may require, by written notice, certain
information from the Secretary of the Department of Defence, the Secretary of DVA, or the
CDF. The proposed amendments would enable the MRCC to require information from any
Commonwealth, State or Territory Departments and authorities, such as the Australian
Taxation Office, Medicare or Centrelink, and other persons such as current or former
treatment providers or other third parties.
The written notice must specify the period, the document or information (or both) that is in
the possession, custody or control of that person that is required. In addition, the written
notice must be given without delay. The inclusion of the strict liability and penalty
provisions indicate the gravity that non-compliance to provide the required information or
document may have on a claim. This would replicate similar provisions within the MRCA.
The amendments to section 151 of the DRCA would ensure the "Obtaining information'
provisions are similar to those within the MRCA. Section 406 of the MRCA was modelled
on the sections 128 and 129 of the Veterans' Entitlements Act 1986. This amendment would
align the power to obtain information across the three Acts.
Notes on Clauses
Item 1 will repeal section 151 and the heading, and substitute it with "MRCC may obtain
information etc." It will also insert new subsections 151(1) to (11). These new provisions
are similar in purpose and effect to subsections 406(1) to (11) of the MRCA.
New subsection 151(1) would replicate the existing subsection 406(1) of the MRCA.
New paragraph 151(1)(a) will enable the MRCC to require a person, by written notice, to
provide the MRCC (or a specified staff member assisting the MRCC) with such information
as it requires for the purposes of the Act. New paragraph 151(1)(b) will enable the MRCC to
require a person, by written notice, to produce to the MRCC (or a specified staff member
assisting the MRCC) any documents in the custody of, or under their control. New paragraph
151(1)(c) enables the MRCC to require a person, by written notice, to appear before a
specified staff member assisting the MRCC to answer questions.
Subsection 151(2) would retain the current subsection 151(1) prescribing the persons the
MRCC could require to provide documents or information. The persons specified in
subsection 151(2) include the Secretary of the Defence Department, the Secretary of DVA
and the Chief of the Defence Force. The purpose of this provision is to provide clarification
that the Defence and DVA Secretaries and the CDF are not exempt from these provisions
with the repeal of section 151.
5
New paragraph 151(2)(d) would replicate subsection 406(2) of the MRCA. New
subparagraphs 151(2)(d)(i) and (ii) would remove doubt as to whom the MRCC will be able
to give a written notice. New subparagraph 151(2)(d)(i) will enable the MRCC to give a
written notice to a person employed in, or in connection with, a Department of the
Commonwealth, a State or Territory or by an authority of the Commonwealth, State or
Territory. New subparagraph 151(2)(d)(ii) will enable the MRCC to give a written notice to
a person employed by any authority of the Commonwealth, a State or Territory. The use of
the term 'in connection with' is to be inclusive of those relationships between a person and
the Commonwealth that may fall outside the usual understanding of 'employed by'.
New subsection 151(3) would replicate subsection 406(3) of the MRCA. New subsection
151(3) will specify the requirements for the written notice. Subparagraph 151(3)(a)(i)
specifies if paragraph 151(1)(a) or (b) applies, the period in which the person must comply
with the notice and (ii) the manner in which the person must comply with a notice. New
subparagraphs 151(3)(b)(i) and (ii) will specify, if paragraph 151(1)(c) applies, that a notice,
requiring a person to appear before a specified staff member assisting the MRCC, must
specify the time at which the person must appear before staff member; and the place at which
the person must appear before the staff member. This sections purpose is to ensure sufficient
certainly is provided in the notice to facilitate full compliance.
New subsection 151(4) would replicate subsection 406(4) of the MRCA. New subsection
151(4) will provide that the specified period mentioned in subsection 151(3) must be at least
14 days after the notice is given. This is to ensure that the person served the notice has
sufficient time to comply with the notice requirements. However, the notice may specify a
longer period.
New subsections 151(5) and (6) would replicate subsections 406(5) and (6) of the MRCA.
New subsection 151(5) will provide that the MRCC may require the information or answers
to be verified by, or given on, oath or affirmation, either orally or in writing. New subsection
151(6) will provide that a staff member to whom information or answers are verified or given
may administer the oath or affirmation. The purpose of this section is to ensure that the
person provides a true and honest version of the required information or document.
New subsection 151(7) would replicate subsection 406(7) of the MRCA. New subsection
151(7) will provide that a person is not required to give information, produce a document or
give evidence if, in doing so, the person would contravene a law of the Commonwealth. A
new Note after subsection 151(7) will provide that a person cannot be prevented by a law of a
State or Territory from giving information, producing documents or giving evidence for the
purposes of the Act.
New subsection 151(8) would replicate subsection 406(8) of the MRCA. New subsection
151(8) would replicate subsection 406(8) of the MRCA. New subsection 151(8) will provide
that section 151 binds the Crown in each of its capacities but does not make it liable to be
prosecuted for an offence.
New subsection 151(9) would replicate subsection 406(9) of the MRCA. New subsection
151(9) will provide that a person commits an offence if they fail to comply with a notice
under section 151. The penalty of committing an offence under section 151(9) is 10 penalty
units. Penalty unit is defined in subsection 4AA(1) of the Crimes Act 1914 as $210. As part
6
of good administrative practice where the MRCC issues a notice, it will include reference to
the relevant offence and the application of a penalty.
This provision purpose is to ensure timely compliance where the MRCC has provided a
written notice to require information. A DVA client may be adversely affected where
information critical to their claim is not provided by third parties within a reasonable time.
This clause would be critical to the timely administration of these provisions.
New subsection 151(10) would replicate subsection 406(10) of the MRCA. Subsection
151(10) will provide that an offence under subsection (9) is a strict liability offence. The
intention behind imposing strict liability for an offence under subsection 151(9) is to
recognise the seriousness of the MRCC's need to obtain sufficient information to determine a
person's claim and the potential significant financial consequences for that person. The
offence will not apply to the extent that the person is incapable of complying with the notice
(see subsection 151(11) below).
New subsection 151(11) would replicate subsection 406(11) of the MRCA. New subsection
151(11) will provide that a person does not commit an offence under subsection (9) where
they are incapable of complying with the notice. A new Note under subsection 151(11) will
provide that the defendant bears an evidential burden in relation to the matter and refers to
subsection 13.3(3) of the Criminal Code Act 1995 (Cth) (Criminal Code). Evidential burden
under subsection 13.3(6) of Criminal Code means the burden of adducting or pointing to
evidence that suggests a reasonable possibility that the matter exists or does not exist. The
evidential burden is also known as the criminal burden of proof.
New section 151AA will insert the heading "Self-incrimination". New subsection 151AA
would replicate subsection 407 of the MRCA.
New subsection 151AA(1) will provide that an individual cannot be excused from giving
information or evidence, or producing a document under section 151 on the grounds that the
information or evidence, or the production of the document, might tend to incriminate the
individual or expose the individual to a penalty.
New subsection 151AA(2) will provide at paragraphs (a) to (c), that the information or
evidence given or the document produced; the giving of the information or evidence or
producing the document; and any information, document or thing obtained as a direct or
indirect result of giving the information or evidence or producing the document, are not
admissible in evidence against the individual in any proceedings, other than for an offence
against section 137.1 (False or misleading information) or 137.2 (False or misleading
documents) of the Criminal Code that relates to this Act.
This section creates a legal obligation on a person to provide the information required in the
notice, however, it also ensures where that information is provided it cannot be used against
the person in any criminal proceedings with the exception of where the person provided false
or misleading documents or information.
Item 2 will insert new subsection 151A(1AA) before subsection 151A(1) in section 151A
Giving information. New paragraph 151A(1AA) will provide that nothing in a law of a State
or Territory operates to prevent a person from giving information, producing documents or
7
giving evidence for the purposes of the Act. This subsection is the same in purpose and
effect as subsection 409(1) of the MRCA.
Item 3 is an application provision, which will provide that the amendments in this schedule
apply in relation to a notice given under subsection 151(1) of the DRCA on or after the day of
commencement.
Commencement
The amendments in Schedule 2 commences the day after Royal Assent.
8
Schedule 3 - Exempt lump sums
Veterans' Entitlements Act 1986
Background
The amendments proposed to be made by Schedule 3 would amend the VEA to allow certain
exempt lump sum determinations made by the Secretary of DSS to apply to DVA income
support clients.
The determination would create an exemption of certain lump sums from the income test that
apply to DVA income support clients. Where a DVA client is on an income support payment
and receives a lump sum payment that is exempt from the income test the income test is
calculated without considering that lump sum. However, the current exception to exclude
lump sum determinations under section 5H in relation to ordinary income of a company or
trust and primary production will be retained.
Currently, the Repatriation Commission often implements separate, yet identical, exempt
lump sum determinations for payments that have already been exempted under the SSA by
the Secretary of the DSS. The process to replicate this instrument maintains an
administrative practice that may be removed by allowing exempt lump sum determinations
made by the Secretary for Social Services to apply to DVA income support clients where the
exemption is consistent with DVA legislation and policy.
Currently, DSS already provides DVA with information of all determinations made under
section 35A and subsection 8(11) of the SSA, no additional work would be required for DSS
if the amendments were made. DVA would no longer be required to draft and register
instruments that have already been enacted by DSS, resulting in increased administrative
efficiency.
A similar approach is already in place. Under section 35A of the SSA the Minister for Social
Services has the authority to determine that a particular fund is an "approved personal care
support scheme" and that any payments made from that fund will be exempt from the income
test. Paragraph 5H(8)(ya) of the VEA provides that a payment towards the cost of a
"personal care support service" for a person, made under a scheme approved under section
35A of the SSA, is not income in relation to a person for the purposes of the VEA, and
therefore not included in the assessment of the income test.
It is expected that DVA and DSS will enter into a formal agreement that DSS will continue to
provide information of relevant determinations to DVA. This will ensure that DVA is aware
of determinations that are already in place.
Notes on Clauses
Item 1 amends subsection 5(H)(1) (definition of exempt lump sum) under section 5H (Income
test definitions). Subsection 5(H)(1) is amended by omitting "subsection (12)" and
substituting "subsections (12) and (12A)". This is a consequential amendment to item 3
below to insert new section 5H(12A).
Item 2 amends subsection 5H (note 1 to the definition of ordinary income) by omitting
"subsection (12)" and substituting "subsections (12) and (12A)". This amendment ensures
9
that the definition of an exempt lump when calculating ordinary income includes an exempt
lump sum within the meaning of subsection 8(11) of the SSA. This is a consequential
amendment to item 3 below to insert new section 5H(12A).
Item 3 inserts new subsection 5H(12A) after subsection 5H(12). New subsection 5H(12A)
expands the meaning of exempt lump sum to provide that an amount received by a person is
also an exempt lump sum if the amount is an exempt lump sum within the meaning of
subsection 8(11) of the SSA.
This amendment will enable a determination by the Secretary of the Department of Social
Services made under subsection 8(11) of the SSA to be a determination under subsection
5H(12) of the VEA which will also apply to the income test under the VEA.
The existing paragraph 5H(12)(c) will be retained to ensure the Commission may make a
determination to specify an exempt lump sum is an amount, or one of a class of amounts, that
the Commission determines to be an exempt lump sum.
Item 4 amends subsection 5Q(1)(definition of exempt lump sum) in section 5Q (Dictionary)
by omitting "subsection 5H(12)" and substituting "subsections 5H(12) and (12A)". This
amendment ensures that the definition of an exempt lump sum under the VEA Dictionary
includes an exempt lump sum within the meaning of subsection 8(11) of the SSA. This is a
consequential amendment to item 3 above to insert new section 5H(12A).
Items 5 and 6 substitutes subparagraphs 52ZZM(1)(c)(iii) and 52ZZZM(2)(c)(iii) with new
subparagraphs to insert a reference to subsections 5H(12) and 5H(12A). These sections deal
with the calculation of ordinary income of a company or trust and the net income of a
primary production enterprise. This amendment ensures that the ordinary income of a
company or trust and the net income of a primary production enterprise will include an
amount that is subject to the determination made under subsections 5H(12) and (12A). This
retains the current arrangements where the lump sum exemption determinations do not apply
company or trust and the net income of a primary production enterprise.
Item 7 is an application provision which will provide that the amendments made by this
schedule apply in relation to an amount received on or after the commencement of the item.
Commencement
The amendments in Schedule 3 commences the day after Royal Assent.
10