Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021

Administered by Department of Veterans' Affairs

Legislation au F2021L00498 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021

Instrument 2021 No. R6

 

EMPOWERING PROVISION

Subsection 52ZZZWEA(3) of the Veterans’ Entitlements Act 1986 (VEA).

 

PURPOSE

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021 (Instrument 2021 No. R6) (the Determination) is made under subsection 52ZZZWEA(3) of the VEA. The Determination replaces the Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2020 (Instrument 2020 No. R25).

The purpose of the Determination is to set out the maximum amount of the income and assets of a special disability trust that can be spent for purposes that are primarily for the benefit of the principal beneficiary (other than for the primary purposes of a special disability trust which are to meet reasonable care and accommodation needs of the beneficiary).

A special disability trust is a private trust, established by family members, to provide primarily for the reasonable care and accommodation needs of a family member with a severe disability. 

The Determination is designed to allow a certain amount of trust income and assets (known as “the discretionary spending amount”) to be used for the benefit of the principal beneficiary for purposes other than the primary purposes of the trust, while retaining the “special disability trust” status.

The Determination maintains the discretionary spending amount at $12,500 for the 2020-2021 financial year, with the Determination to take effect from 1 July 2021.  The lack of an increase in the amount is a consequence of the low CPI increase over the past year.

The authority to revoke the earlier determination is found in subsection 33(3) of the Acts Interpretation Act 1901. The subsection provides that where an Act confers a power to make, grant or issue any instrument of a legislative or administrative character (including rules, regulations or by-laws), the power shall be construed as including a power exercisable in the like manner and subject to the like conditions (if any) to repeal, rescind, revoke, amend, or vary any such instrument.

 


CONSULTATION

Section 17 of the Legislation Act 2003 requires a rule-maker to be satisfied, before making a legislative instrument that any consultation the rule-maker considered appropriate and reasonably practicable, has been undertaken.

The Department of Social Services (DSS) and the Department of Veterans’ Affairs (DVA) have virtually identical legislative instruments in place relating to special disability trusts.  The Social Security and Families Team at DSS were consulted in the course of this exercise to ensure a consistent approach in the preparation of the instrument to set the discretionary spending amount.  The nature of consultation with DSS was by way of email correspondence.

DSS advise that the indexation of the threshold is government policy and occurs in July each year and that Services Australia was consulted during the preparation of their proposed instrument, the Social Security (Special Disability Trust – Discretionary Spending) Determination 2021.

In these circumstances, it is considered that the requirements of section 17 of the Legislation Act 2003 have been met.

 

RETROSPECTIVITY

None.

 

DOCUMENTS INCORPORATED BY REFERENCE

No.

 

REGULATORY IMPACT

A Regulation Impact Statement is not required for this Determination because this Determination is not regulatory in nature, will not impact on business activity, and will have no, or minimal, compliance costs or competition impact.

 

FURTHER EXPLANATION OF PROVISIONS

 

See: Attachment A

 


HUMAN RIGHTS STATEMENT

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011.

Overview

The Determination is made under subsection 52ZZZWEA(3) of the Veterans’ Entitlements Act 1986.

The purpose of the Determination is to set out the maximum amount of the income and assets of a special disability trust that can be spent for purposes that are primarily for the benefit of the principal beneficiary (other than the primary purposes of a special disability trust which are to meet reasonable care and accommodation needs of the beneficiary).

The maximum amount is twelve thousand, five hundred dollars ($12,500) in the 2021‑2022 financial year.

Human rights implications

The Determination engages the following human rights:

  • the right to social security as recognised in Article 9 of the International Covenant on Economic, Social and Cultural Rights (ICESCR); and
  • the right to an adequate standard of living as recognised in Article 11 of ICESCR and Article 28 of the Convention on the Rights of Persons with Disabilities.

The Determination promotes the right to social security and the right to an adequate standard of living for those people whose entitlements under the VEA are affected by receiving income from a special disability trust.  The rights will be promoted by providing for an amount of $12,500 as the limit for the discretionary use of special disability trust funds before the trust loses its status as a ‘special disability trust’.

Conclusion

The attached Determination is compatible with human rights because it promotes the right to social security and the right to an adequate standard of living.

 

 

 

 

Wendy Cummings

Director - Benefits and Payments Policy Section, Policy Development Branch, as delegate of the Repatriation Commission

 

Rule-Maker

 


Attachment A

 

 

FURTHER EXPLANATION OF PROVISIONS

 

Section 1

This section sets out the name of the instrument – the Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021.

 

Section 2

This section provides the Determination commences on 1 July 2021.

Section 3

This section provides that the instrument for the 2020-2021 financial year, the Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021, will be revoked on the commencement of this instrument.

 

Section 4

 

This section provides that the authority for making the instrument is subsection 52ZZZWEA(3) of the Act.

 

Section 5

This section defines the terms used in the Determination.

 

Section 6

This section provides that, for the purposes of subsection 52ZZZWEA(3) of the Veterans’ Entitlements 1986, the maximum value of income and assets that can be applied by a special disability trust for other purposes that are primarily for the benefit of the principal beneficiary (other than purposes that are the primary purpose of the special disability trust) is $12,500 for the financial year commencing on 1 July 2021.

Overview

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021 (Instrument 2021 No. R6) was enacted to provide clarity and consistency in the management of special disability trusts under the Veterans’ Entitlements Act 1986 (VEA). This legislation, introduced by the Australian Parliament, addresses the need to set a specific limit on discretionary spending from special disability trusts while ensuring that these trusts can still serve their primary purpose of meeting the reasonable care and accommodation needs of beneficiaries with severe disabilities. The policy objective is to allow a certain amount of trust income and assets to be used for the benefit of the principal beneficiary for purposes other than the primary purposes of the trust, without losing the trust's special status. This Determination maintains the discretionary spending amount at $12,500 for the 2021-2022 financial year, reflecting the low Consumer Price Index (CPI) increase over the past year. The enactment ensures that special disability trusts can provide financial flexibility for the beneficiaries, while also promoting the human rights to social security and an adequate standard of living, as recognised in various international covenants and conventions.

Scope and Application

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021 applies to special disability trusts established by family members to provide primarily for the reasonable care and accommodation needs of a family member with a severe disability. The Determination sets out the maximum amount of the income and assets of such a trust that can be spent for purposes that are primarily for the benefit of the principal beneficiary, other than for the primary purposes of the trust. The Determination applies nationally, as it is made under the Commonwealth’s Veterans’ Entitlements Act 1986, and is intended to ensure consistency across jurisdictions in the discretionary spending amount for special disability trusts. The Determination maintains the discretionary spending amount at $12,500 for the 2021-2022 financial year, reflecting the low Consumer Price Index increase over the past year. The Determination does not contain any exclusions, exemptions, or thresholds other than the specified discretionary spending amount. While the Determination itself does not extend or restrict application through subordinate instruments, the authority to revoke or amend it is found in subsection 33(3) of the Acts Interpretation Act 1901.

Key Provisions

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2021 (section 1) is an instrument made under subsection 52ZZZWEA(3) of the Veterans’ Entitlements Act 1986 (VEA). It replaces the previous Determination from 2020, which was made under the same subsection. The primary function of this Determination is to establish the maximum amount of income and assets from a special disability trust that can be used for purposes benefiting the principal beneficiary, excluding the primary needs of care and accommodation (section 6). For the 2021-2022 financial year, this amount is set at $12,500. The Determination imposes specific obligations on the parties involved. It mandates that the income and assets of a special disability trust can be used for purposes benefiting the principal beneficiary, but only up to the specified limit of $12,500 (section 6). This limit ensures that the trust retains its status as a "special disability trust" while allowing for some discretionary spending. The trust must also ensure that the primary purpose of providing care and accommodation for the beneficiary is not compromised. Breaches of the provisions set out in the Determination can lead to serious consequences. Although the Determination does not explicitly list penalties, non-compliance with the conditions set for discretionary spending may result in the trust losing its special status. This could affect the entitlements and benefits available to the principal beneficiary under the VEA. Moreover, if the trust is misused to the extent that it no longer meets the requirements for a special disability trust, it may be subject to additional scrutiny or penalties under related legislation. The Determination also engages with certain human rights, as outlined in the human rights statement. It promotes the right to social security and an adequate standard of living, as recognised under international human rights instruments such as the International Covenant on Economic, Social and Cultural Rights (ICESCR) and the Convention on the Rights of Persons with Disabilities. By setting the discretionary spending limit at $12,500, the Determination aims to support these rights, ensuring that beneficiaries receive adequate support while maintaining the integrity of the special disability trust structure.

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Sourced from the Federal Register of Legislation at 26 August 2026. For the latest information on Australian Government law please go to https://www.legislation.gov.au.