War widow(er)'s pension and compensation offsetting

This page provides a general outline of how a war widow(er)'s pension under the Veterans’ Entitlements Act 1986 (VEA) may be affected by compensation from another source in respect of a veteran’s death.

Compensation offsetting can be complex. If this process will affect you, before making any decisions you are strongly encouraged to contact the Department of Veterans’ Affairs (DVA) to receive advice that is specific to your circumstances. You may also wish to obtain financial advice as compensation offsetting normally affects a war widow(er)'s pension for life.

Back to top

What is compensation offsetting?

Offsetting is the process of reducing one compensation payment in recognition of another compensation payment for the same incapacity or death of a veteran. The principle behind compensation offsetting is that a person should not be compensated twice for a veteran’s incapacity or death, irrespective of whether they have eligibility from more than one source.

If a person receives any award of compensation or damages from another source for the same death, whether this be other statutory compensation or common law damages etc., there must be a corresponding reduction or offset to the amount of pension paid under the VEA to preclude double compensation.

Essentially, a person eligible for compensation from more than one source should not receive more than a person only eligible for the one source of compensation.

The war widow(er)'s pension and orphan’s pension paid under the VEA are compensation for a veteran’s death.

Back to top

What is an award of compensation or damages?

Compensation is a defined term in the VEA and includes:

• any payment in the nature of compensation; or
• any damages recoverable at law from a government or any other person (whether within or outside Australia), in respect of injury to, or the death of, a person; or
• any amount paid under a compromise or settlement of a claim for damages.

Payments under the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) or the Military Rehabilitation Compensation Act 2004 (MRCA) also administered by DVA are compensation.

Compensation or damages does not include:

• any expenses incurred in medical or hospital treatment;
• payments under an insurance policy owned by a veteran or dependant (for example, life insurance, travel injury or death insurance, loss of income protection insurance);
• superannuation payments; or
• a Severe Injury Adjustment and the Additional Death Benefit which may be paid under the Defence Act 1903.

Essentially, any monetary compensation that is received for the death of a veteran (that isn’t excluded above) will be treated as compensation.

Back to top

Who does this affect?

Any person who is seeking or who receives a pension in respect of the death of a veteran, payable under the VEA who:

• has received a benefit from another source for the death of the veteran; or
• is eligible to claim a benefit from another source for the death of the veteran.

Back to top

How an award of compensation or damages affects your war widow(er)'s pension

The VEA requires that the amount of a war widow(er)'s pension payable in a fortnight must be reduced (or offset) to the extent that any other periodic (e.g. weekly or fortnightly) compensation payment is made in the same period because of the veteran’s death. The offset is applied on a dollar for dollar basis.

If the other compensation is made as a lump sum payment, an equivalent indexed fortnightly amount has to be calculated so it can be offset on an equal basis to the war widow(er)'s pension. This amount will be indexed and the offset will apply for life.

The Australian Government Actuary has provided instructions and a table so that the Department can make this calculation. A copy of the relevant table is included at the end of this page.

Example: – A widow, born on 7 July 1963, was granted a war widow’s pension effective from 8 October 1999. On 8 January 2000, she receives a compensation lump sum of $150,000.00 from another source because of liability for the veteran’s death.

The ‘age next birthday’ in the table is based on the date that a war widow’s pension commenced, or the date on which the lump sum was received, whichever is the earlier. In this example, the initial fortnightly equivalent pension rate for a female who is 37 next birthday is $15.171 per $10,000.

Thus, the initial fortnightly equivalent for the lump sum amount of $150,000.00 is:-

$150,000 X $15.171 = $227.56
$10,000

Back to top

How a compensation lump sum may affect past payments of a war widow(er)'s pension

Where a war widow(er)'s pension is in payment and a lump sum of compensation is later paid for the veteran’s death, the VEA deems that the fortnightly equivalent pension to be offset will have started when the war widow(er)'s pension started.

This means that compensation offsetting operates retrospectively and that some or all of the war widow(er)'s pension already paid becomes an amount not payable to the widow(er). This constitutes an overpayment that must be recovered. Where DVA is aware of the other compensation claim, recovery by a deduction from the lump sum is arranged through the widow(er)'s solicitor or DVA.

Back to top

Information on the effects of proposed compensation payments

If you have been told that you are likely to receive an award, payment or settlement of a compensation claim you should find out how this payment will affect your pension. DVA can advise you of the likely impact which may be subject to final adjustments depending on the actual date of payment.

Back to top

If you have dependent children

Orphan's pensions are subject to offsetting arrangements. Benefits provided under the Veterans’ Children Education Scheme are not offset.

Back to top

Treatment entitlements – the Veteran Gold Card

War widows(er)s and orphans who receive a Veteran Gold Cardunder the VEA retain their entitlement to a Gold DVA Health Card regardless of compensation offsetting. You will also retain any other concessions provided by other entities associated with the issue of this card.

Back to top

Income support supplement

Should you also be entitled to the payment of income support supplement (ISS) this payment will be reassessed at the same time as your war widow(er)’s pension is adjusted.

Back to top

Energy Supplement

War widow(er)s retain their entitlement to the Energy Supplement regardless of compensation offsetting. 

Back to top

Legal advice and reconsideration

The VEA does not contain any capacity for review of offsetting decisions to the Veterans’ Review Board, or the Administrative Appeals Tribunal.

The offsetting provisions are “self-executing”, that is they don’t require a decision to be made by a DVA delegate. Therefore, there is no decision made, other than the actual rate of pension that can be reviewed.

If you are not satisfied with the decision, in relation to the offset amount, your options are to seek legal advice about appeal to the Federal Court for the purposes of the Administrative Decisions (Judicial Review) Act 1977, or to contact the Commonwealth Ombudsman and request an independent investigation of the way the offset has been administered. The contact number for the Ombudsman is 1300 362 072.

Alternatively, you may seek a reconsideration of the decision by another Delegate. However, please note that if reconsideration is undertaken that decision will not result in any right of review under the VEA.

Back to top

Obligation to notify

A person who receives a pension under the VEA must tell the Department within 21 days if compensation or damages are claimed or received.

Back to top

Freedom of Information

Under the Freedom of Information Act 1982 you may apply to inspect or request a copy of documents which are held on your DVA files. Applications for access to documents must be lodged in writing. For more information refer to Access information. 

Back to top

The Australian Government Actuary’s Table

AGE NEXT BIRTHDAY	MALES	FEMALES	AGE NEXT BIRTHDAY	MALES	FEMALES
1	12.685	12.484	47	18.032	16.993
2	12.701	12.499	48	18.317	17.228
3	12.744	12.535	49	18.618	17.475
4	12.790	12.573	50	18.936	17.735
5	12.838	12.614	51	19.270	18.010
6	12.888	12.655	52	19.624	18.299
7	12.940	12.699	53	19.998	18.605
8	12.994	12.744	54	20.393	18.928
9	13.050	12.791	55	20.811	19.270
10	13.108	12.839	56	21.255	19.632
11	13.169	12.890	57	21.726	20.017
12	13.232	12.943	58	22.228	20.426
13	13.298	12.997	59	22.762	20.861
14	13.366	13.054	60	23.333	21.325
15	13.437	13.112	61	23.942	21.818
16	13.510	13.173	62	24.592	22.345
17	13.585	13.235	63	25.288	22.908
18	13.661	13.299	64	26.034	23.511
19	13.739	13.365	65	26.833	24.159
20	13.819	13.434	66	27.691	24.855
21	13.902	13.505	67	28.614	25.605
22	13.988	13.580	68	29.611	26.414
23	14.079	13.658	69	30.691	27.288
24	14.173	13.739	70	31.861	28.233
25	14.271	13.823	71	33.132	29.257
26	14.374	13.912	72	34.515	30.367
27	14.481	14.003	73	36.020	31.573
28	14.592	14.099	74	37.659	32.888
29	14.708	14.199	75	39.446	34.323
30	14.830	14.303	76	41.395	35.894
31	14.956	14.412	77	43.521	37.621
32	15.088	14.525	78	45.842	39.524
33	15.226	14.643	79	48.380	41.626
34	15.370	14.767	80	51.155	43.950
35	15.521	14.896	81	54.191	46.520
36	15.679	15.030	82	57.512	49.363
37	15.845	15.171	83	61.140	52.504
38	16.019	15.317	84	65.098	55.971
39	16.201	15.471	85	69.411	59.791
40	16.392	15.632	86	74.097	63.993
41	16.593	15.800	87	79.174	68.602
42	16.804	15.976	88	84.649	73.642
43	17.025	16.160	89	90.522	79.132
44	17.258	16.354	90	96.772	85.081
45	17.503	16.557	91	103.350	91.486
46	17.761	16.769

 

Back to top