EXPLANATORY STATEMENT
Military Rehabilitation and Compensation (Payment of Additional Amount) Instrument 2026
EMPOWERING PROVISION
The Military Rehabilitation and Compensation Commission (the Commission) makes this instrument under subsection 80A(3) of the Military Rehabilitation and Compensation Act 2004 (the Act).
PURPOSE
The Military Rehabilitation and Compensation (Payment of Additional Amount) Instrument 2026 (the instrument) prescribes the criteria and circumstances to whom an additional amount in respect of an eligible young person (EYP) or child is payable to under the Act. If the additional amount is payable to more than one person, the instrument outlines how the payment is apportioned. Subsection 80A(3) of the Act provides the Commission may make the instrument. Subsection 80A(4) of the Act provides the instrument may relate to the legal responsibility or other arrangements for the care of the EYP or child.
Accordingly, the instrument prescribes 50% of the additional amount is payable to the veteran and 50% to the other person or persons who provide care to the EYP or child, except in circumstances where there are other written formal or informal care arrangements in place. If there is a written formal or informal care arrangement in place at the relevant time, the payment is to be apportioned in accordance with those arrangements.
Whom the additional amount is payable to is introduced into the Act on 1 July 2026 following the commencement of the Veterans’ Entitlements, Treatment and Support (Simplification and Harmonisation) Act 2025 (the VETS Act). This insertion enables the additional amount under section 80 of the Act to be apportioned in line with care arrangements in respect of the EYP or child.
OVERVIEW
Section 80 of the Act provides an additional tax-free compensation lump sum in respect of severely impaired veterans who, at the relevant time, have dependent EYP’s or children. Subsections 80A(1) and 80A(2) provide that the Commission may provide the additional amount in respect of the same dependent EYP or child to more than one person in proportion with the circumstances set out in an instrument. Subsection 80A(3) of the Act authorises the Commission to make an instrument. Section 80A(3) provides the instrument may determine:
- The person or persons to whom an additional amount in respect of an EYP or child is payable; and
- If the additional amount is payable to more than one person – the proportion of the additional amount that is payable to each of the persons.
Subsection 80A(4) provides the instrument may specify the criteria and requirements to take into consideration other forms of care arrangements and legal responsibility in respect of the EYP or child.
The intent and purpose of attributing the section 80 payments under the Act is to recognise circumstances where there is more than one person providing care to a veteran’s dependent EYP or child. This recognises varying family arrangements and ensures the additional amount is directed to serve the best interests of the EYP or child.
EXPLANATION OF PROVISIONS
Section 1 states the name of the instrument.
Section 2 provides that the instrument commences 1 July 2026.
Section 3 sets out the authority for the Military Rehabilitation and Compensation Commission making the instrument, namely subsection 80A(3) of the Act.
Section 4 sets out the definitions used in this instrument.
Section 5 provides the persons to whom the additional amount is to be paid. The additional amount may be paid to the impaired person, or another person who provides care in respect of the EYP or child.
Section 6 provides that where an EYP or child is cared for by the impaired person only, the amount under section 80 of the Act is to be paid to the impaired person in full.
Section 7 provides the apportionment arrangements where the care in respect of the EYP or child is shared between an impaired person, and other carer or carers identified in section 5.
Subsection 7(1) provides that 50% of the amount payable under section 80 of the Act is to be paid to the impaired person. The remaining 50% is to be paid to the other primary carer or carers. The other person or persons for the purposes of subsection 7(1)(b) are those who provide care in respect of the EYP identified in paragraph 5(b) and excludes the impaired person who has already received a portion under paragraph 7(1)(a).
Subsection 7(2) provides that where there are two or more other persons, excluding the impaired person, who provide care to the EYP or child, the 50% payment payable under paragraph 7(1)(b) of the instrument is to be divided amongst the other persons.
Subsection 7(3) provides an apportionment arrangement that overrides the arrangements provided in subsection 7(1), if there are shared care arrangements in place. Where a shared care arrangement is in place, the payment is to be apportioned in accordance with those shared care arrangements. This is intended to ensure that payments are apportioned in accordance with the equivalent percentage of care prescribed in court orders or agreed in parenting plans as at the relevant date, regardless of the economic contributions made by respective carers.
Section 8 provides the payment arrangements upon the death of a person whom the additional amount is payable under section 80 because of sections 6 or 7 of the instrument. This section provides that where a person to which the additional amount is payable to has died, the amount payable is to be paid to the person’s estate.
This section is intended to cover instances where an impaired person or carer of an EYP or child passes away before the additional amount is paid to them. If the impaired person or carer dies, the amount payable in accordance with this instrument must be paid to their estate. This is intended to ensure that the same arrangements that apply under section 436 of the Act for veterans will also apply in respect of other entitled persons.
Consultation
In respect of the VETS Act, the Department of Veterans’ Affairs undertook extensive consultation with stakeholders, including three rounds of public consultation on the simplification and harmonisation of veterans’ portfolio legislation. The outcome of this process produced strong support from veterans, ex-service organisations and other stakeholders and informed the pathway to establish the Act as the sole, ongoing scheme for veterans’ compensation and rehabilitation from 1 July 2026. This included that the additional lump sum be apportioned to the primary carers from 1 July 2026. This supports a harmonised and integrated system for the provision of compensation under a single, ongoing Act into the future.
When the Veterans’ Entitlements, Treatment and Support (Simplification and Harmonisation) Bill 2024 was introduced into the Parliament, section 80A was drafted to provide 100% of the additional amount to either to the impaired veteran, or to the other person with the primary care of the EYP or child. Feedback during the Parliamentary scrutiny process highlighted that section 80 limited payment to only one person, rather than allowing for apportionment based on actual caring and family arrangements. It was specifically noted that it was crucial for veterans with substantial injuries to retain control over the use of their compensation. Section 80 was consequently amended to account for varied caring and family arrangements and to provide for the section 80 payment to be apportioned equitably between one or more persons involved in the care of the EYP or child. The instrument incorporates feedback received following extensive consultation and the Parliamentary scrutiny process.
Collection, use and disclosure of personal information
This instrument requires the primary carer or carers to provide information that will aid in establishing they meet the requirements to be paid the additional compensation payable, including where a written care arrangement is available. The disclosure to another entitled person, other than the veteran, that an additional amount is payable, may also impliedly disclose to that person(s) that the veteran has reached 80 impairment points. Without this requirement, it is not possible to apportion the additional compensation as required under subsection 7(3). Personal information is collected, used and disclosed in accordance with the Privacy Act 1988.
Human rights implications
This instrument is compatible with the human rights and freedoms recognised or declared under section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011. A full statement of compatibility is set out in Attachment A.
Making the instrument
The instrument is made by the Military Rehabilitation and Compensation Commission.
Approved by
Military Rehabilitation and Compensation Commission
Rule-maker
Attachment A
Statement of Compatibility with Human Rights
Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011
Military Rehabilitation and Compensation (Payment of Additional Amount) Instrument 2026
This Disallowable Legislative Instrument 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 (the recognised rights).
Overview of the Disallowable Legislative Instrument
The Military Rehabilitation and Compensation (Payment of Additional Amount) Instrument 2026 (the instrument) is made under subsection 80A(3) of the Military Rehabilitation and Compensation Act 2004 (the Act).
Human rights implications
This instrument engages the following human rights:
- The right to social security under article 9 of the International Covenant on Economic, Social and Cultural rights.
- The right to privacy as contained in article 17 of the International Covenant on Economic, Social and Cultural Rights.
Right to Social Security
The right to social security requires that a system be established under domestic law, and that public authorities must take responsibility for the effective administration of the system. The social security scheme must provide a minimum essential level of benefits to all individuals and families that will enable them to acquire at least essential health care, basic shelter and housing, water, sanitation, foodstuffs, and the most basic forms of education.
The instrument promotes the right to social security by allowing the Military Rehabilitation and Compensation Commission to determine and apportion the additional amount payable, to assist with raising the eligible young person (EYP) or child.
Right to Privacy
The instrument may limit the right to privacy by specifying that for a person to be determined an entitled person to an additional amount, the person must provide the Commission with information that they provide care to a veteran’s EYP or child. This is necessary to enable the finalisation of a veteran’s claim for compensation under the Act and to determine eligible recipients of an additional amount.
In providing information to the Commission, an entitled person (other than the veteran) may draw an inference in respect of a veteran’s severe impairment level, as this is the basis for the additional amount eligibility. This is reasonably necessary to give effect to the determination under the Act that an entitled person, other than the veteran, is eligible to receive a portion of the additional amount. Information and communication technology (ICT) and procedural safeguards are in place to ensure privacy is reasonably protected.
Conclusion
This Legislative Instrument is compatible with human rights because it promotes the right to social security.
Military Rehabilitation and Compensation Commission
Rule-Maker