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ESTIMATES COMMITTEE ESTIMATES COMMITTEE E - 05/09/1991 - DEPARTMENT OF VETERANS' AFFAIRS - Subprogram 1.1-Income support

SENATOR NEWMAN -So that is one of the major activities of this coming year, is it?

MS GRIMSLEY -It is something that we are heading for in 1995, yes.

SENATOR NEWMAN -But it is described here as a major activity to be undertaken in 1991-92.

MS GRIMSLEY -Yes, 1991-92 sees the start of it from our Department's point of view. We have just recently recruited someone with a tax background who is going to be looking at the issues of particular concern to Veterans' Affairs and taking those issues along to the meetings with officials from Treasury and Social Security.

SENATOR NEWMAN -So it is an interdepartmental committee working on it at this stage; is that right?

MS GRIMSLEY -It is a working party at this stage, yes.

SENATOR NEWMAN -On page 37 there is reference to the determining system. When was the new claims review commenced and when was it completed?

MS GRIMSLEY -It was completed in June, and I will just have to check the start date of that.

SENATOR TATE -May we take that on notice?

SENATOR NEWMAN -Yes; that would save time. I am particularly interested in what the findings were.

MS GRIMSLEY -The findings were that our approach with our new design claim forms is very acceptable to the veterans. After a bit of initial teething trouble in a couple of the States, the staff are also very happy with them. The research company that we employed, Reark, spoke to a selected range of veterans and to staff, and we got some very positive feedback. Most of the recommendations are along the lines of small changes to the wording in some of the questions and a bit of rearranging of some of the questions. But they were very happy with the format and the style. Those veterans who had claimed previously using the old forms and had come back into the system particularly saw the advantage of it, and we got quite a few very positive comments about our staff as well as about the forms themselves.

SENATOR NEWMAN -I have tried to help people with some of the forms. I am very happy to have them changed. I note that there were 28,082 primary level decisions, of which 25,237 were appealable. Why were the other 2,800 not appealable?

MS GRIMSLEY -I would have to take that one on notice, Senator.

SENATOR NEWMAN -I note that the Department is taking steps to ensure that all relevant material is provided to the first decision maker. Just what steps were taken in 1990-91?

MS GRIMSLEY -To start with, we rewrote part 3 of the VEA in plain English. That was a big step for us. We have also had some training courses, particularly in the area of qualifying service, that have been directed from central office, as well as the ongoing benefits training in the States themselves. They have a responsibility for that.

We are in the process at the moment-it was started in 1991-of rewriting our general orders, the manual of instruction that supports the legislation, based on the rewrite and putting it onto our general system so that it will be very easily updated and also very easily searched through, rather than having a heavy, thick paper document in which it is sometimes hard to find information. There are a lot of indexing problems and things like that that we need to improve.

SENATOR NEWMAN -Is the general system in general use yet?

MS GRIMSLEY -Hopefully, by the time we have our GOs rewritten, enough machines will be available in each of the income support areas. People do not need constant access to it; one machine can support quite a number of people. You do not need to refer to the GOs every time you make a decision; you need to refer to them on an ad hoc basis.

SENATOR NEWMAN -So what is happening at the moment with the General? Is it being piloted still?

MS BARR -The General is in daily use in the Veterans' Affairs advisory centres . There are some redevelopment activities going on with the General at the moment to increase its turnaround time, its speed of processing, and there will be some new equipment provided to extend it further across the organisation in the coming year.

SENATOR NEWMAN -Is that going to be used by regional officers on the move with laptops as well?

MS BARR -Somewhere down the track. At the moment it is not yet developed to that point but it certainly could be.

SENATOR NEWMAN -It is capable of that, is it?

MS BARR -Yes, it is one of the development plans.

SENATOR NEWMAN -Have you seen tangible improvements as a result of the developments or the changes or is it too early?

MS GRIMSLEY -For the rewrite it is too early; it only came into effect from 1 July this year.

SENATOR NEWMAN -In the 1989-90 annual report of the Commission it was stated that there is a clear need to speed up the processing of claims by simplifying the system and improving efficiency. To what extent have those concerns been addressed?

MS GRIMSLEY -The review that you spoke about earlier is one of the major ways in which we attempted to improve that. As well as looking at the forms we looked at the actual process which a person goes through when he or she claims and how we could simplify and streamline it. A lot of our contact is via phone or people walking in off the street.

When they walk in off the street, we go through a very special checklist with them which is designed to identify the areas that that person has: for instance, special investments or whether he or she happens to have children. If the person does not have children or does not have that investment, he or she does not get that component of the claim form. So that makes it much quicker to assess and it makes it easier for people to complete and quicker to get it back to us.

When they ring up we also use that checklist and then forward out to them just the components that they need.

MS BARR -I also briefly mention that we have undertaken a major review of work practices over the last year and there are something like 161 recommendations arising from that review, most of which will be implemented throughout the next year. They are all designed to speed up processing and to deliver greater productivity.

SENATOR NEWMAN -And you will be reporting on that in your next report?

MS BARR -We will be reporting on that in the next annual report.

SENATOR NEWMAN -I will be very interested to know how it goes.

MS GRIMSLEY -Actually, I think I might just add something there. Not all the 161 are actually related to improvements in work practices. Some of them are in the process in which we count our work and the monitoring side of it as well.

SENATOR NEWMAN -I want to turn now to the question of the widows pension. I have had a response from the Minister to a query as to why it is that the widow of a service pensioner is financially better off by revoking her service pension widow's entitlement and transferring to a single rate age pension with the Department of Social Security. The Minister's letter did not answer why the Department does not automatically increase the service pension entitlement of a widow on the death of a spouse to match that of a Social Security age pension. Does the Department consider that this would be administratively more efficient?

MS GRIMSLEY -Sorry, could you just ask me again?

SENATOR NEWMAN -The answer did not tell me directly why the Department did not automatically increase the service pension entitlement of a widow on the death of a spouse to match that of a Social Security age pension.

MS BARR -We might have to give you a written response to that one, Senator. We will try to answer it more clearly next time.

SENATOR NEWMAN -The Minister also said that the Department had an ongoing review of the need of veterans and their dependents and I was wondering whether that issue was included in that review?

MS BARR -When the Minister said there is an ongoing review of the needs of veterans and their dependents, I think it was a general reference to our ongoing responsibility to continually keep under review the needs of veterans and their dependants.

SENATOR NEWMAN -He went on to say, `And policy in relation to widows will continue to be an important part of this process'. So, in that it was the letter supposedly answering my question about the widow of a service pensioner , I took it to mean that that was included in the review, although it was not.

MS BARR -I think that there was not a specific review being referred to.

SENATOR NEWMAN -Perhaps I was just meant to think that, was I?

MS BARR -I would not have thought so.

SENATOR NEWMAN -Perhaps you could take that on notice and just tell me what the Minister's letter of 4 September really means. Data matching: what savings have accrued from the introduction of data matching for 1990-91?

MS GRIMSLEY -Are you talking about the data matching that is flowing out of the tax file number legislation?

SENATOR NEWMAN -Yes.

MS GRIMSLEY -I cannot give you that figure at this point in time. We have commenced collection of tax file numbers and we have had a number of mail-outs to retrieve those. There are runs of data matching under way at the moment but we do not have the output as yet to check and see whether we have matches or mismatches and the outcomes of those. We are expecting those this month.

SENATOR NEWMAN -In April I seem to believe that it was estimated at being $6. 75m. How could the estimate be made then? What was it being based on, do you think?

MS GRIMSLEY -It was based on a pro rata figure of the estimates made from the Department of Social Security. When they estimate savings, and we are doing activities of the same nature, we usually take a pro rata based on our population as a percentage of theirs.

SENATOR NEWMAN -The strange thing was that in April, in the Estimates then, the Department conceded that there would not be any savings out of disability pensions, war widows or service pensions. I just could not work out where these savings were to be derived from.

MS GRIMSLEY -I am sorry, Senator. I would need to look at the source documents to answer your question properly.

SENATOR NEWMAN -Right. Well my source document here is page E56 of the Senate Estimates Committee E on 18 April. Mr Galt was answering me. It was in those additional appropriations that the $6.75m was estimated as savings but when I got the answer from Mr Galt I could not see where the savings would be. Now you still believe there are going to be savings but you have not got them quantified. Am I right?

MS GRIMSLEY -We believe there are going to be savings this current financial year, yes. But, other than the estimated figure, I cannot give you exact figures because we have not got the data yet.

SENATOR NEWMAN -If there is an explanation for the things I have been asking perhaps you would take it on notice?

MS BARR -Yes, we will check up on that.

MS GRIMSLEY -I will have a look at that answer for you.

SENATOR NEWMAN -On page 9, up near the top, there are savings of $20.25m due to computer matching. What activities are included under that title of computer matching? Is that meant to be the same thing as data matching?

MS GRIMSLEY -Yes. That is the estimated savings from the tax file numbers.

SENATOR NEWMAN -For this current year?

MS GRIMSLEY -Yes, for this financial year.

SENATOR NEWMAN -So it is the same thing we are talking about?

MS GRIMSLEY -Yes.

SENATOR NEWMAN -On page 8 of the derivations there was an item of $212,000 for roll-over computer matching. What are those costs? What do they mean?

MS GRIMSLEY -That is because royal assent was somewhat delayed for this particular legislation. I think it was late January when we received royal assent. Data matching did not start, or collection of tax file numbers even did not start until later than was originally planned. So we did not spend the money but we were obviously going to require it this year when we started quite extensive collection of tax file numbers and then investigation of any mismatches, et cetera, and also some of the systems development side of it as well. So, we asked for the funds to be rolled over into this financial year.

SENATOR NEWMAN -Thank you. In the April estimates it was indicated that the Department was at the preliminary stage of looking at a four-tier pension structure as opposed to the current ten-tier structure. First of all, I wondered what the four tiers would end up being and what progress has been made since April.

MS BARR -Are you talking about the disability pension structure?

SENATOR NEWMAN -A four-tier pension structure, being in a very preliminary stage of looking at that. It was Mr Hawker talking about it. It is to do with rehabilitation, so it would be, yes.

MS BARR -Mr Dalton could update you on that.

MR DALTON -It was one of the options that had been, and is being, considered for potential future directions for disability pensions. At this stage it is still one of the options under consideration.

SENATOR NEWMAN -So nothing has been done about it?

MR DALTON -It is part of the evaluation and consideration of the broader issues of development of disability pension options. It was not put in as an intended course but as one of the possibilities and it is still being considered.

SENATOR NEWMAN -But, in fact, it has gone nowhere. No decisions have been taken.

MR DALTON -No decisions have been taken on it.

SENATOR NEWMAN -Has any work been done on it?

MR DALTON -Some work has been done, yes.

SENATOR NEWMAN -What is the purpose of it?

MR DALTON -It was an issue that was taken in conjunction with the revision of the GARP process to look to modifications of the 10-step pension scale to see whether it was appropriate to modify it to a simpler structure, simply that.

SENATOR NEWMAN -GARP did not go that way. So what is being done now?

MR DALTON -The issues with GARP are still the subject of consultation with the ex-service organisations. We have had a number of meetings and there are some options coming forward that are being considered in consultation with the ex- service community .

SENATOR NEWMAN -They seem to be coming forward quite slowly. I asked officers a while ago and I asked veterans a while ago and everybody then said that negotiations are proceeding. They seem to be proceeding at a snail's pace. Where are they up to?

MR DALTON -There was a meeting held in August where the ex-service community came back with some views they wished to be further developed. We have done that. Some papers had gone out for consideration. They had come back with views. We are in the process of taking those views and developing the options that they had suggested so that we can further discuss it with them. To a certain extent, that time is driven by the consideration of the ex-service community of the broader issues.

SENATOR NEWMAN -Yes, but in the meantime we have a lifestyle questionnaire having to be used, have we not-or being used? It does not have to be, but everybody knows they should be doing it. So when do you anticipate that it is going to come to completion?

MR DALTON -Our anticipation is that the options that the ex-service community and the Department have been discussing will be finalised by the end of the year.

SENATOR NEWMAN -So you are moving gradually closer and closer, are you?

MR DALTON -Yes, and indeed there is a great deal of common ground in the options that are being discussed.

SENATOR NEWMAN -What progress has been made on the campaign medals approach to qualifying service for service pension?

MR DALTON -The matter is to go to Government for consideration.

SENATOR NEWMAN -When?

MR DALTON -It is now being prepared to go forward.

SENATOR NEWMAN -You are preparing a Cabinet submission now, are you?

MR DALTON -Yes.

SENATOR NEWMAN -On page 8 of the derivations I note there is a reduction of service pension numbers leading to a saving of $52,433m. What savings are projected over the coming three to four years due to reducing pension numbers?

MS BARR -We will have to take that one on notice, Senator, and supply some further information to you.

SENATOR NEWMAN -You might have the same problem with the next question, which relates to page 15 of the derivations. There is a saving shown on that page of $8.441m due to reduction of disability pension numbers. I was going to ask there: what savings are projected over the next three to four years due to reducing disability pension numbers?

MS BARR -We can supply that one to you fairly quickly. We will take it on notice.

SENATOR NEWMAN -Staying on page 15 for a minute, why has the plain English rewrite led to savings of $40,000?

MR BEAR -There was $40,000 provided to do that job in the previous year that is not required this year. So in the derivation--

SENATOR NEWMAN -So it is shown as a saving.

MR BEAR -It is not a saving, it is a reduction in running costs.