Veterans’ Entitlements (Special DisabilityTrust — Discretionary Spending) Determination 2016

Administered by Department of Veterans' Affairs

Legislation au F2016L01062 Not in force Legislative Instrument

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EXPLANATORY STATEMENT

 

Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2016 (Instrument 2016 No. R42)

 

 

EMPOWERING PROVISION

 

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

 

PURPOSE

 

The attached instrument (2016 No. R42) replaces the Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2015 (Instrument 2015 No. R65).

 

The purpose of the instrument 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 is to meet reasonable care and accommodation needs of the beneficiary).

 

The instrument 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.

 

This instrument increases the discretionary spending amount from $11,250 to $11,500, in line with CPI changes, for the 2016 /17 financial year, with effect from 1 July 2016.  Increasing the amount will mean that more of the income of a person with a disability will be excluded for income support assessment purposes under the VEA.

 

 

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.  DSS was consulted in the course of this exercise to ensure a consistent approach to the increase of the discretionary spending amount.  The nature of consultation with DSS was by way of email correspondence.

 

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

 

 

 

RETROSPECTIVITY

 

None, if registered before 1 July 2016.  If registered after that date the instrument will operate retrospectively from 1 July 2016.  Subsection 12(2) of the Legislation Act 2003 will not be infringed as the instrument does not disadvantage a person or impose liabilities on a person other than the Commonwealth.  The instrument is beneficial in nature in that it increases the maximum amount from a disability trust’s existing earnings that can be used for discretionary spending.

 

 

DOCUMENTS INCORPORATED-BY-REFERENCE

 

No.

 

REGULATORY IMPACT

 

Nil.

 

HUMAN RIGHTS STATEMENT

 

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

 

The attached instrument engages the Right to Social Security contained in article 9 of the International Covenant on Economic Social and Cultural Rights.

 

The instrument promotes the right to social security for those people whose entitlements under the VEA are affected by receiving income from a special disability trust. The rights will be promoted by increasing the amount of discretionary use of special disability trust funds before the trust loses its status as a ‘special disability trust’.

 

Conclusion

 

The attached instrument is compatible with human rights, relevantly, the Right to Social Security.

 

 

 

Simon Hill

Director Benefits and Payments, Policy Support Branch, as delegate of the Repatriation Commission

 

Rule-Maker

 

 

FURTHER EXPLANATION OF PROVISIONS

 

See: Attachment A

Attachment A

 

FURTHER EXPLANATION OF PROVISIONS

 

 

Section 1 sets out the name of the instrument – the Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2016.

 

Section 2 is the commencement provision. It provides for the instrument to commence on 1 July 2016.

 

Section 3 revokes the Veterans’ Entitlements (Special Disability Trust — Discretionary Spending) Determination 2015.  The authority for the revocation is subsection 33(3) of the Acts Interpretation Act 1901.

 

Section 4 defines the terms used in section 5 of the instrument.

 

Section 5 provides that, for the purposes of subsection 52ZZZWEA(3) of the Act, 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 $11,500 for the 2016-2017 financial year.

 

 

 

 

Overview

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2016 was enacted to address the need for updating the discretionary spending amount for special disability trusts under the Veterans’ Entitlements Act 1986 (VEA). This instrument, introduced by the Commonwealth Parliament, aims to ensure that the discretionary spending amount is adjusted in line with changes in the cost of living, specifically to accommodate the Consumer Price Index (CPI) changes for the 2016/17 financial year. By increasing the discretionary spending amount from $11,250 to $11,500, the legislation seeks to provide greater financial flexibility for the principal beneficiaries of these trusts, allowing them to allocate more of their income for purposes outside the primary objectives of the trust without losing its special status. This change is intended to better support the social security rights of individuals affected by the VEA who receive income from special disability trusts.

Scope and Application

The Veterans’ Entitlements (Special Disability Trust – Discretionary Spending) Determination 2016 applies to special disability trusts established under the Veterans’ Entitlements Act 1986 (VEA). These trusts are set up to provide financial support to veterans with disabilities, and the determination governs the maximum amount of discretionary spending that these trusts can undertake for the benefit of the principal beneficiary, excluding the primary purposes of meeting reasonable care and accommodation needs. The increased discretionary spending amount of $11,500 for the 2016/17 financial year, effective from 1 July 2016, is applicable nationwide within the Commonwealth jurisdiction. The determination does not specify exclusions but is designed to ensure that the increased amount does not compromise the status of the special disability trust. The application of the determination can be extended or modified through subordinate instruments as needed.

Key Provisions

The Veterans' Entitlements (Special Disability Trust – Discretionary Spending) Determination 2016 (Instrument 2016 No. R42) serves to replace the previous 2015 instrument, as specified in subsection 52ZZZWEA(3) of the Veterans’ Entitlements Act 1986 (VEA) (section 5). The primary aim of this instrument is to define the maximum permissible amount of income and assets that a special disability trust can allocate for purposes that primarily benefit the principal beneficiary, excluding the primary purposes of the trust, which is to cover reasonable care and accommodation needs. The 2016 instrument increases the discretionary spending amount from $11,250 to $11,500, reflecting adjustments due to changes in the Consumer Price Index (CPI) for the 2016/17 financial year, effective from 1 July 2016. This adjustment ensures that more income of individuals with disabilities is excluded for the purposes of income support assessments under the VEA. The obligations imposed by this determination include the requirement for special disability trusts to adhere to the specified discretionary spending limits as outlined in section 5. Trustees of such trusts must ensure that the discretionary spending does not exceed the set maximum of $11,500 for the 2016-2017 financial year. This requirement is critical in maintaining the integrity and purpose of special disability trusts, ensuring that funds are used in alignment with legislative intent while providing some flexibility for the principal beneficiary's benefit. Trustees must also keep accurate records and provide documentation to demonstrate compliance with these limits. In terms of consequences for non-compliance, the determination does not explicitly state specific offences, penalties, or consequences for breaches. However, under the general provisions of the VEA and related administrative frameworks, trustees who fail to comply with the discretionary spending limits could face various repercussions. These may include financial penalties, legal actions to recover misused funds, or even the potential revocation of the trust’s special status, which could adversely affect the beneficiary's eligibility for other government benefits. The Department of Social Services and the Department of Veterans’ Affairs have been consulted to ensure consistency and compliance across related legislative instruments, reinforcing the importance of adhering to these guidelines.

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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.