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Veterans' Affairs Legislation Amendment (Further Budget 2000 and Other Measures) Bill 2001
Schedule 1 Compensation recovery

   

Veterans’ Entitlements Act 1986

1  Subsection 5NB(1) (note to the definition of periodic payments period )

Repeal the note.

2  Subsection 5NB(2)

Omit “subsection (3), (4), (5) or (6)”, substitute “subsection (3), (4), (5), (6) or (6A)”.

3  Paragraph 5NB(4)(b)

Repeal the paragraph, substitute:

                     (b)  either:

                              (i)  the agreement under which the contributions are made does not provide for the amounts that would otherwise be payable under the agreement being reduced or not payable because the recipient is eligible for or receives the compensation affected pension under this Act; or

                             (ii)  the agreement does so provide but the compensation payment has been calculated without reference to the provision.

4  After subsection 5NB(6)

Insert:

          (6A)  A payment under a law of the Commonwealth, a State or a Territory that provides for the payment of compensation for a criminal injury does not constitute compensation for the purposes of this Act.

          (6B)  The reference in subsection (6A) to a criminal injury is a reference to a personal injury suffered, or a disease or condition contracted, as a result of the commission of an offence.

5  Subsection 5NB(7)

Omit “For the purposes”, substitute “Subject to subsection (8), for the purposes”.

6  At the end of paragraph 5NB(7)(c)

Add “, or both”.

7  Paragraph 59N(c)

Omit “and”.

8  Paragraph 59N(d)

Repeal the paragraph.

9  Subsection 59Q(1)

After “person for”, insert “any day or days in”.

10  Paragraph 59Q(2)(d)

After “person for”, insert “any day or days in”.

11  Paragraph 59Q(2)(e)

After “partner for”, insert “any day or days in”.

12  Subsection 59Q(2A)

After “person for”, insert “any day or days in”.

13  Paragraph 59Q(3)(a)

Repeal the paragraph, substitute:

                     (a)  begins on the day following the last day of the periodic payments period or, if there is more than one periodic payments period, the day after the last day of the last periodic payments period; and

14  Section 59Q (example)

Repeal the example.

15  Paragraph 59R(1)(b)

After “pension for”, insert “any day or days in”.

16  Paragraph 59R(5)(b)

Repeal the paragraph, substitute:

                     (b)  the sum of the payments of the compensation affected pension made to the person for a day or days in the lump sum preclusion period.

17  Section 59R (example)

Repeal the example.

18  Section 59S

Omit “per fortnight of a pension”, substitute “of compensation affected pension”.

19  Section 59T

Repeal the section, substitute:

59T   Effect of periodic compensation payments on rate of person’s compensation affected pension

             (1)  If:

                     (a)  a person receives periodic compensation payments; and

                     (b)  the person was not, at the time of the event that gave rise to the entitlement of the person to the compensation, receiving a compensation affected pension; and

                     (c)  the person is eligible for a compensation affected pension for a day or days in the periodic payments period;

the rate of the person’s compensation affected pension for that day or those days is reduced in accordance with subsection (2).

Note:          For periodic compensation payments , compensation affected pension and periodic payments period , see subsection 5NB(1).

             (2)  The person’s daily rate of compensation affected pension is reduced by the amount of the person’s daily rate of periodic compensation.

             (3)  The reference in subsection (2) to a daily rate of periodic compensation is a reference to the amount worked out by dividing the total amount of the periodic compensation payments referred to in paragraph (1)(a) by the number of days in the periodic payments period.

             (4)  If:

                     (a)  a person receives periodic compensation payments; and

                     (b)  at the time of the event that gave rise to the entitlement of the person to compensation, the person was receiving a compensation affected pension; and

                     (c)  the person is eligible for a compensation affected pension for a day or days in the periodic payments period;

the periodic compensation payments are to be treated as ordinary income of the person for the purposes of this Act.

Note:          For ordinary income , see subsection 5H(1).

59TA   Effect of periodic compensation payments on rate of partner’s compensation affected pension

             (1)  If:

                     (a)  a person receives periodic compensation payments; and

                     (b)  the person is a member of a couple; and

                     (c)  the person was not, at the time of the event that gave rise to the entitlement of the person to the compensation, receiving a compensation affected pension; and

                     (d)  the person is eligible for a compensation affected pension for a day or days in the periodic payments period but, solely because of the operation of this Part, does not, or would not, receive the pension; and

                     (e)  the person’s partner is eligible for a compensation affected pension, or is qualified for a compensation affected payment under the Social Security Act, for a day or days in the periodic payments period;

then, in working out the amount of the pension or payment referred to in paragraph (e), the amount (if any) by which the daily rate of periodic compensation payable to the person exceeds the daily rate of the compensation affected pension for which the person is eligible for a day or days in the periodic payments period is to be treated as ordinary income of the person’s partner.

Note 1:       See also point SCH6-E3A for the effect of that excess on the application of the ordinary/adjusted income test.

Note 2:       For periodic compensation payments , compensation affected pension and periodic payments period , see subsection 5NB(1).

Note 3:       For ordinary income , see subsection 5H(1).

             (2)  The reference in subsection (1) to a daily rate of periodic compensation is a reference to the amount worked out by dividing the total amount of the periodic compensation payments referred to in paragraph (1)(a) by the number of days in the periodic payments period.

20  Paragraph 59V(a)

Repeal the paragraph, substitute:

                     (a)  the rate of a person’s compensation affected pension is to be reduced under this Part; and

21  Subsection 59W(1) (note)

Omit “and a compensation debt is involved, see subsections 56H(7) and (8)”, substitute “, see point SCH6-E4”.

22  Paragraph 59W(3)(d)

Repeal the paragraph, substitute:

                     (d)  the difference between:

                              (i)  the sum of the payments of compensation affected pension made to the person for a day or days in the periodic payments period; and

                             (ii)  the sum of the payments of compensation affected pension that would have been made to the person for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of section 59T.

23  Paragraph 59W(4)(d)

Repeal the paragraph, substitute:

                     (d)  the difference between:

                              (i)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, made to the person and the person’s partner for a day or days in the periodic payments period; and

                             (ii)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, that would have been made to the person and the person’s partner for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of sections 59T and 59TA.

24  Section 59W (examples 1 and 2)

Repeal the examples.

25  Section 59X

Repeal the section, substitute:

59X   Periodic compensation payments not counted as ordinary income

                   If the rate of a person’s compensation affected pension is reduced under section 59T because of the receipt of a series of periodic compensation payments, those payments are not regarded as ordinary income of the person for the purposes of this Act.

26  Paragraph 59Y(1)(b)

Repeal the paragraph, substitute:

                     (b)  the person receives or claims a compensation affected pension for a day or days in the period to which the compensation relates;

27  Paragraph 59ZA(1)(b)

After “for”, insert “any day or days in”.

28  At the end of subsection 59ZA(3)

Add “, unless subsection (5A) applies in which case it is worked out under subsection (5A) instead”.

29  Paragraph 59ZA(4)(b)

After “for”, insert “any day or days in”.

30  Paragraph 59ZA(4)(c)

Repeal the paragraph, substitute:

                     (c)  the difference between:

                              (i)  the sum of the payments of compensation affected pension made to the person for a day or days in the periodic payments period or the lump sum preclusion period; and

                             (ii)  the sum of the payments of compensation affected pension that would have been made to the person for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of subsection 59T(1);

31  Paragraph 59ZA(5)(b)

After “for”, insert “any day or days in”.

32  Paragraph 59ZA(5)(c)

Repeal the paragraph, substitute:

                     (c)  the difference between:

                              (i)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, made to the person and the person’s partner for a day or days in the periodic payments period or the lump sum preclusion period; and

                             (ii)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, that would have been made to the person and the person’s partner for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of subsection 59T(1) and section 59TA;

33  After subsection 59ZA(5)

Insert:

          (5A)  If:

                     (a)  at the time of the event that gave rise to the entitlement of a person to compensation, the person was receiving a compensation affected pension; and

                     (b)  the person or the person’s partner is eligible for a compensation affected pension for a day or days in the periodic payments period;

the recoverable amount is the amount determined by the Commission to be the total amount by which the person’s, or the person’s partner’s, compensation affected pension for a day or days in the periodic payments period would have been reduced, because of point SCH6-E4 (payment of arrears of periodic compensation payments), if a determination had been made under section 56D, 56E, 56EA or 56EB.

34  Paragraph 59ZE(1)(b)

Repeal the paragraph, substitute:

                     (b)  the person receives or claims a compensation affected pension for a day or days to which the compensation relates; and

35  Paragraph 59ZG(1)(b)

Repeal the paragraph, substitute:

                     (b)  the person receives or claims a compensation affected pension for a day or days in the periodic payments period or the lump sum preclusion period; and

36  At the end of subsection 59ZG(3)

Add “, unless subsection (5A) applies in which case it is worked out under subsection (5A) instead”.

37  Paragraph 59ZG(4)(b)

After “for”, insert “any day or days in”.

38  Paragraph 59ZG(4)(c)

Repeal the paragraph, substitute:

                     (c)  the difference between:

                              (i)  the sum of the payments of compensation affected pension made to the person for a day or days in the periodic payments period or the lump sum preclusion period; and

                             (ii)  the sum of the payments of compensation affected pension that would have been made to the person for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of subsection 59T(1);

39  Paragraph 59ZG(5)(b)

After “for”, insert “any day or days in”.

40  Paragraph 59ZG(5)(c)

Repeal the paragraph, substitute:

                     (c)  the difference between:

                              (i)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, made to the person and the person’s partner for a day or days in the periodic payments period or the lump sum preclusion period; and

                             (ii)  the sum of the payments of compensation affected pension, and of compensation affected payments under the Social Security Act, that would have been made to the person and the person’s partner for any such day or days had those payments been made at the rate to which the payments were reduced as a result of the operation of subsection 59T(1) and section 59TA;

41  After subsection 59ZG(5)

Insert:

          (5A)  If:

                     (a)  at the time of the event that gave rise to the entitlement of a person to compensation, the person was receiving a compensation affected pension; and

                     (b)  the person or the person’s partner is eligible for a compensation affected pension for a day or days in the periodic payments period;

the recoverable amount is the amount determined by the Commission to be the total amount by which the person’s, or the person’s partner’s, compensation affected pension for a day or days in the periodic payments period would have been reduced, because of point SCH6-E4 (payment of arrears of periodic compensation payments), if a determination had been made under section 56D, 56E, 56EA or 56EB.

42  At the end of point SCH6-E3

Add “However, in making this calculation disregard any amount that is taken (whether for the purposes of this Act or of the Social Security Act) to be ordinary income of either partner because of section 59TA of this Act or section 1174 of the Social Security Act.”.

43  After point SCH6-E3

Insert:

Additional ordinary income because of excess compensation payments

SCH6-E3A  Add to the amount derived for a person under point SCH6-E3 any amount that is taken (whether for the purposes of this Act or of the Social Security Act) to be ordinary income of the person because of section 59TA of this Act or section 1174 of the Social Security Act.