Announcement date
3 July 2024
Link to announcement
New legislation to simplify and harmonise veteran compensation | Minister for Veterans' Affairs (dva.gov.au)
Problem being addressed
The current veterans’ compensation and rehabilitation legislation framework is governed by three separate Acts, with fundamental structural differences. Determining which compensation is to be provided to veterans and veterans’ families depends not only on the nature of the service undertaken, but also on the date a particular member joined the Australian Defence Force (ADF). The complexity in this multi-Act approach contributes to claims processing delays and uncertainty for veterans and families as to what they may be entitled to as current or former serving members of the ADF. Furthermore, compensation outcomes for veterans can differ significantly over the different frameworks for similar conditions or injuries, depending on the claimant’s individual circumstances.
Various Government and independent reviews have identified that the framework is extremely complex and in need of simplification. The Productivity Commission found that the existing framework is not-fit-for-purpose and requires fundamental reform. The Interim Report of the Royal Commission into Defence and Veteran Suicide found that this complexity could adversely affect the mental health of veterans.
Proposal
The IA considers four options to reform the veterans’ compensation and rehabilitation framework:
- Option 1 – Status Quo.
- Option 2 – Small-scale improvements that do not require large scale Government investment and can be implemented at a policy level or by minor legislative amendment.
- Option 3 – Move to a two-scheme approach based on the Productivity Commission’s 2019 report ‘A Better Way to Support Veterans”. This option entails compensation and rehabilitation delivered under two schemes – the current Veterans' Entitlements Act 1986 (VEA) and the Military Rehabilitation and Compensation) Act 2004 (MRCA) harmonised with the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA)
- Option 4 – All future claims received will be determined under the Military Rehabilitation and Compensation Act 2004 (MRCA) as the single ongoing act, irrespective of when and where the veteran served, or when their injury or illness occurred. This option also seeks to implement further improvements to the veterans’ support system such as aligning benefits across the compensation system. From a future date, the VEA and DRCA would be closed to claims.
The IA identifies Option 4 as the preferred option.
Assessed Impact Analysis outcome
Good Practice
Assessment comments
The analysis in the IA is good quality overall. The IA addresses the seven IA questions and follows an appropriate policy development process commensurate with the significance of the problem and magnitude of the proposed intervention. In particular, the IA provides comprehensive reasoning that all viable options have been considered. The IA also includes detailed discussion of the consultation process and the incorporation of stakeholder feedback into informing the preferred option.
To achieve ‘Exemplary’ the IA needed to further detail the specific impacts (either quantified or qualified) of the considered options and articulate a more comprehensive evaluation plan, identifying responsibilities and timeframes.
Regulatory burden
The Department of Veterans’ Affairs estimates these measures will result in an estimated reduction in regulatory costs of $5.5 million per year, averaged over ten years.