Stuart Robert (Fadden, Liberal Party, Shadow Minister for Defence Science, Technology and Personnel) Share this | Hansard source

This bill implements the adopted recommendations of the Campbell review of military compensation arrangements. The review was a 2007 Labor election commitment. Regrettably, it has taken six long years—or 120 days until the election—for Labor to conclude this. Clearly, veterans are not a great priority for this government. The review made 108 recommendations and the Labor government has adopted 94 of them. A further two will be enhanced. The total package is worth about $39 million over the forward estimates, at a net cost to the Commonwealth of about $17.4 million. There are 16 schedules, 13 of which deal directly to 13 recommendations of the review that require legislative amendments.

The Campbell review was chaired by former secretary of the Department of Veterans' Affairs Mr Ian Campbell PSM. It principally investigated compensation arrangements for the Military Rehabilitation and Compensation Act, the MRCA. By way of background, regrettably, in March 1996 outside of Townsville an Army training accident involving a Blackhawk helicopter led to the death of 18 personnel and the serious injury of a further 12. At the time it was found that the death and ancillary compensation arrangements for peacetime training accidents were inadequate. It followed the Tanzer review, which recommended a new modern compensation scheme be adopted for military personnel wounded, injured or incapacitated during their Defence service.

The previous coalition government consulted extensively about the legislation. It was tabled in parliament in 2003. At the time of its introduction former Minister for Veterans' Affairs Ms Vale said that the new bill combined the very best elements of the older Veterans' Entitlements Act 1986, the VEA, and the Safety, Rehabilitation and Compensation Act 1988. The new legislation placed a heavy focus on rehabilitation, encouraging those able to do so to re-enter the workforce following acceptance of conditions under the legislation. Unlike the older VEA, which pays a pension for life, the MRCA gave affected ex-service personnel and their families the choice of a lump-sum payment or enabled a mix of a lump-sum and weekly payments. Under this legislation eligible ex-service personnel continue to have their health care covered at Australian government expense. That is the history. That is where we came from.

In the election campaign in 2007 Labor promised to review the MRCA. However, despite their good intentions in 2007, suffice to say that the process has been slow. The review process began in 2008, and in February 2011 the government was handed the outcome. They did not formally respond until the May 2012 budget, and the introduction of the legislation in March 2013, five sitting weeks before the scheduled dissolution of parliament, is disappointing in the extreme.

When asked about the government's proposed time line, Parliamentary Secretary for Defence Senator David Feeney told Senate estimates that the pursuit of a non-existent budget surplus was more important than delivering improvements to military compensation sooner. It is disappointing for everyone.

We are pleased to see the review and that it has found that MRCA is operating soundly and is in need of only minor improvements. The improvements being made in this legislation are important. They have our support. Following the introduction of the legislation the coalition quite rightly initiated a Senate inquiry to ensure that the veterans and ex-service community, and indeed the wider community, had an opportunity to comment on this important legislation and its review. The wider the comment, the sounder the outcome. That is a lesson we should all learn. Submissions acknowledged that the proposed legislation mirrored the recommendations adopted by the government and for the most part supported its passage.

Our concerns—and they should be tabled—are that it has taken the government until now to partially adopt recommendation 25.1 regarding the extension of non-liability mental health care treatment to veterans and ex-service people. We also note that this entitlement will not be available until 1 July next year. Recommendation 25.1, and the position preferred by the Department of Veterans' Affairs, by Defence and by the independent analysis from Peter Sutherland, said that the government should consider providing non-liability health cover under MRCA for certain psychiatric conditions to all former members of the ADF and part-time reservists who have served after 1 July 2004. Typically, Finance, Treasury and DEEWR preferred a wait-and-see approach, saying that more information was required before a final decision was taken. You have had only six years: how much more information do you want? This occurred over the last 12 months and resulted in an announcement on 3 May in the Defence white paper of a limited increase in entitlements back to 1994, but only when the ex-service personnel had a minimum of three years equivalent full-time service. This $14.6 million extension, whilst welcome, is at odds with the original recommendation from DVA and Defence, and further information will be sought through the Senate estimates period coming up shortly. Similarly, the budget does not provide any funding for additional advocacy funding support, which unfortunately continues Labor's neglect of grassroots veterans advocacy in the community.

Labor's decision two years ago to strip $4 million from the BEST funding will only make it more difficult for younger veterans and their families to access independent advice and support for making claims. The government's announcement of additional taxpayer funds to reduce administrative process times in the department is surely an admission that their cuts to the BEST program and advocacy funding have had an impact on the timely determination of compensation claims, and I fail to see how it can be taken any other way.

The gaping hole in this budget was, however, the lack of commitment by this government to fair indexation. It is a fair point and it should be made. For those veterans and ex-service personnel and their families listening to this or reading it, let me reaffirm the coalition's commitment: we will deliver fair indexation in the coalition's first budget. The Leader of the Opposition has signed that pledge twice, first at the Bendigo RSL and second at Queanbeyan only one or two months ago, where I joined him for the signing, and personally signed myself to it.

If there is a change of government, the unfair, unjust and inequitable indexation arrangements facing DFRDB and DFRB military superannuants aged 55 and over will also change. This can only happen with a change of government. If elected on 14 September, in next May's budget we will deliver fair indexation—no ifs, no buts. Under our changes, on 1 July next year the pensions of those in DFRB and DFRDB will increase by the same factor as age and service pensions.

Having gone through the history of the bill and some of its flaws, and having reaffirmed the coalition's position on the indexation of military superannuation, it is important to look at the 16 schedules, 13 of which relate to adopted recommendations of the review.

As I said at the start of this, the coalition will provide the minister with support for the bill. Schedule 1 is on rehabilitation and transition management. The amendments enhance rehabilitation services and transition management. Chapter 7 of the review dealt with transition management between Defence and DVA. It found that a greater consistency in transition across the services is more likely if the CDF was coordinating transition rather than leaving it, as is the case, to the chiefs of each individual service. The amendments will also give part-time reservist personnel access to transition management assistance for the first time under any legislation, which is a good thing. These amendments will redesignate the responsibility of the service chiefs for the rehabilitation of our soldiers, sailors and airmen and airwomen to the CDF.

Schedule 2 is on compensation for permanent impairment. The amendments in schedule 2 make the date of effect for periodic impairment compensation to be on the basis of each accepted condition rather than all accepted conditions and to incorporate a lifestyle factor in the calculation of interim permanent impairment compensation. Under the current arrangements, compensation is paid only once all claims for compensation have been assessed. This has been found to be a somewhat lengthy process. By paying compensation from the date at which liability for each condition is accepted, compensation will flow to members and former members of the ADF presumably much sooner.

The schedule also relates to compensation offsetting arrangements. This amendment will grant those already assessed under the old offsetting formula the ability to have their compensation reassessed under the new compensation offsetting formula methodology. This is supported by the veteran and ex-service community and clearly by the coalition.

Schedule 3 will see expanded lump sum options for wholly dependent partners. The amendments expand the options for lump sum compensation for wholly dependent partners of deceased members. Chapter 9 of the review dealt with the death benefit provisions of MRCA. It recommended the simplification and streamlining of current arrangements. Currently, where a member's death is service related his or her wholly dependent partner is eligible to receive a lifetime periodic payment, a war widow or war widower pension, an additional death benefit, a repatriation health card for all conditions—let us call it a gold card—and a range of other benefits, depending upon their circumstances. This amendment simplifies the payment arrangements by combining the current age based lump sum, an actuarial calculation of the war widow or war widower pension against life tables and the additional death benefit to create a new combined lump sum, making the package simpler and demonstrably easier to understand. It will also give partners a choice of converting their pension into a lifetime lump sum or into 25 per cent, 50 per cent or 75 per cent as a lump sum, with the balance a weekly pension.

Schedule 4 is about weekly compensation for eligible young persons. The amendments put in place a one-time increase in the rate of periodic compensation payable for dependent children so that the rate aligns with similar payments under SRCA. In 2004, the rates of payment under MRCA were the same as those under SRCA. However, changes made in 2008 to SRCA broke this nexus, if we can call it that, and they increased dramatically. Currently, SRCA payments are about $130.89 a week, whereas the MRCA payment is about $87.57 a week. Aligning these makes sense.

Schedule 5 is about compensation for financial advice and legal advice, with the new limit rising to $2,400. In schedule 6, the amendments expand the eligibility rate for special rate disability pensions. The expanded criteria will include a person who would otherwise meet the criteria in section 199 of MRCA except for the person having received a lump sum incapacity payment under section 138 or for the person receiving a nil rate of incapacity payment because the amount of the incapacity payment is fully offset by Commonwealth superannuation. Schedule 6 does not relate to a specific recommendation of the review but rather an observation found in paragraph 11.43. The ex-service community strongly endorses these changed arrangements and they certainly make some sense.

The amendments in schedule 7 make changes to certain superannuation provisions so they apply equally to both serving and former members and amend the definition of 'Commonwealth superannuation scheme'. Chapter 12 of the review considered the interoperation of military superannuation and the military compensation arrangements. The committee noted that this was not an in-depth analysis but 'did note the complexities of administration of invalidity and death benefits' and recommended an analysis across government of how to streamline the administration of these arrangements. The government accepted this recommendation. But no information about the progress of this analysis has been forthcoming. Suffice to say, Minister, we will further examine it at Senate estimates. I ask the minister for further details on the progress on this particular recommendation.

Schedule 8 is about the remittal powers of the Veterans Review Board. They provide the Veterans Review Board with an explicit power to remit a matter to the Military Rehabilitation and Compensation Commission for needs assessment and compensation. The streamlining of the claims appeals process is certainly welcomed by the veteran and ex-service community. It will make it easier for veterans to appeal decisions about their compensation and give veterans with claims under MRCA largely the same appeals system as those under the VEA.

Schedule 9 amendments increase the membership of the Military Rehabilitation and Compensation Commission from five members to six. We note that the review recommends that the additional appointee be someone like the Director of Joint Health Command. Our view is that this would be for the most part a sensible appointment and we look forward to the government confirming this particular appointment to the compensation commission.

The amendments in schedule 10 require all claims for conditions accepted under the VEA and aggravated by Defence service after 1 July 2004 to be determined under the VEA rather than there being a choice offered between the VEA and MRCA, which is currently the case. We agree with all of that.

The amendments in schedule 11 will enable the issuing of repatriation health cards for specific conditions to part 11 Defence related claimants under SRCA—let us call them white cards. This initiative is intended to achieve consistency in treatment arrangements for all former Defence Force members. SRCA members with an injury accepted under SRCA as being related to SRCA—let us call that a SRCA related injury—will be entitled to treatment for a SRCA injury either under MRCA or the VEA in accordance with arrangements established under those various acts. This change is supported in principle. Concerns have been raised about the operation of these proposed new arrangements. Similarly, providers are worried that they will be forced to charge lower rates for services that they are currently providing at higher rates. DVA has informed us that the consultation with the industry is ongoing and this will be pursued at Senate estimates, Minister, to alleviate our concerns on exactly how this would operate. It sounds all right. The devil, as in many cases, will be in the detail.

The amendments in schedule 12 define Defence members undergoing career transition, personnel holding honorary ranks and authorised representatives of philanthropic organisations as members under MRCA. That is fair enough. The amendments in schedule 13 clarify the appropriation of costs for certain aged care services between VEA, the Australian Participants in Nuclear Test Treatment Act and MRCA and the Aged Care Act 1997 and the Aged Care (Consequential Provisions) Act 1997. That is fair enough.

The amendments in schedule 14 will extend the entitlements for travelling expenses to the partner of certain eligible persons under certain conditions. The VEA currently only provides for the veteran to be paid a travelling allowance when attending medical appointments to treat accepted conditions. In circumstances in which the veteran's attendant, a carer, needs to accompany the veteran, travelling expenses may be met.

The amendments in schedule 15 will clarify and streamline the administrative arrangements for the payment of pensions, compensation and other pecuniary benefits under the VEA and the MRCA into appropriate bank accounts. The amendments in schedule 16 include a minor and consequential amendment to the Social Security Act 1991 that clarifies which payments made under MRCA are excluded income for the purposes of the Social Security Act.

Suffice to say, the coalition is happy to support the passage of this legislation through the House. It will go to the Senate and be further considered at the end of June. We will not in any way seek to hold up the passage of the legislation, which we believe provides benefits to veterans, ex-service personnel and their families. We look forward, Minister, to the swift passage of the legislation through the House and the Senate, noting that there are only four and a little bit weeks left, of which two weeks are for the Senate estimates, which literally leaves only two weeks for legislation to be passed in the Senate. I will leave that to you, Minister, to sort through.

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