Veterans’ Affairs

Budget Review 2018–19 Index

Michael Klapdor

The 2018–19 Budget includes a number of measures to build on the Department of Veterans’ Affairs’ (DVA) ongoing Veteran Centric Reform Program—a program aimed at updating DVA’s information technology (IT) systems and improving the services it provides to veterans and their families. The Budget also includes funding to extend access to mental health treatment for some Australian Defence Force (ADF) reservists, to pilot a rehabilitation program for former ADF members completing studies, and to continue a number of initiatives aimed at improving veterans’ employment opportunities.

Overall funding for assistance to veterans and their dependants is expected to decline by 12.3 per cent in real terms (adjusting for inflation) from 2018–19 to 2021–22, primarily due to an expected decline in the number of people receiving assistance.[1]

The only significant new savings measure for the portfolio is a package of changes to dental and allied health services which is expected to deliver $40.7 million in savings over four years from 2018–19.[2] The package includes changes to fee schedules to align with industry standards, changing the ‘treatment cycle’ for general practitioner (GP) referrals to allied health services so that they are valid for 12 sessions rather than 12 months, and trialling new funding models.[3] DVA intends to further review allied health fee schedules from 2021.[4]

Veteran Centric Reform Program

The 2018–19 Budget includes an additional $111.9 million over four years from 2018–19 for the Veteran Centric Reform program. The 2016–17 Budget allocated $24.8 million for the development of a business case for the program and the 2017–18 Budget included $166.6 million for the first stage of the program: a pilot of new payment processing and service delivery systems using DVA’s two student payments as a test case.[5]

The new budget allocation will provide for the second stage of the program: updating the 13 IT systems supporting the delivery of income support payments (such as the Service Pension) and other systems supporting the delivery of compensation (such as incapacity and permanent impairment payments).[6] The additional funding will also be used to implement:

  • a single phone number, 1800VETERAN, for access to DVA services
  • outreach programs to veterans and their families who are not in contact with DVA
  • measures to use ‘the power of data’ to anticipate the needs of veterans and their families and then offer them relevant services and support and
  • increased choice of aids and appliances.[7]

A 2016 Senate Foreign Affairs, Defence and Trade Committee inquiry into the mental health of serving ADF members and veterans set out a range of problems with DVA’s processes and service delivery.[8] The Committee’s main recommendation to address these issues was adequate funding to update DVA’s IT systems.[9] The Australian Public Service Commission also raised serious concerns with DVA’s service delivery models and claims processing in a 2013 capability review.[10]

The Australian National Audit Office (ANAO) is currently undertaking an audit on the efficiency of DVA service delivery (due to be tabled in June 2018) and the Productivity Commission is holding an inquiry into the veterans compensation and rehabilitation system, including whether the system is likely to effectively and efficiently support veterans in the future (due to be completed in June 2019).[11] Both the ANAO and the Productivity Commission reviews were recommendations of a 2017 Senate committee inquiry into suicide by veterans.[12]

Mental health treatment for reservists

The 2017–18 Budget included a measure to provide access to DVA-funded mental health treatments to all current and former ADF members for any recognised mental health condition—without the need to demonstrate that the condition is linked to their service.[13] This followed a 2016–17 budget measure which provided access to treatment for specific mental health conditions for all current and former ADF members. The 2018–19 Budget will build on these measures to provide similar access to mental health treatments for ADF reservists with service in part-time disaster relief and border protection operations, or for those who have been in a serious training accident.

The previous measures limited access to those who were or had been a member of the ADF rendering continuous full-time service. This excluded those with part-time service, such as some reservists.

The new measure will cost $2.2 million over the forward estimates and will provide eligible reservists with access to GPs, psychiatrists, psychologists, medication, hospital treatment and counselling services at DVA’s expense.[14] It will commence on 1 July 2018 and will not require legislation.

Increased payments for veterans undertaking study

In an effort to improve rehabilitation and employment outcomes for former ADF members in receipt of incapacity compensation payments, the Budget includes a pilot measure to maintain these payments at 100 per cent of the former member’s normal earnings while they are engaged in full-time study. Currently, these members see their incapacity payments reduced by up to 25 per cent after 45 weeks (the reduction is based on the number of hours the person is working, with higher rates for those working).[15] DVA has raised concerns that this reduction in payments may result in recipients making short-term decisions about employment ‘at the expense of effective rehabilitation outcomes’.[16]

To be eligible, former ADF members will need to be on a DVA rehabilitation plan, undertaking approved full-time study and be fully supported by the incapacity payment system while undertaking their studies. The measure will cost $10.8 million over four years. It is unclear if an evaluation of the pilot will be undertaken. The measure will require legislation.

Continuing employment programs

The Budget includes $8.3 million for veterans’ employment programs, including support for the Industry Advisory Committee on Veterans’ Employment, the annual awards program for businesses employing veterans under the Prime Minister’s Veterans’ Employment Program and support for a ‘framework for employers to make a public commitment to veterans’ employment’. The Industry Advisory Committee has met three times since being established and the proposed ‘framework’ is one of its initiatives.[17]

In terms of support directly for veterans, $4.3 million of the allocation will fund additional services such as resume and interview preparation, mentoring and translating defence-skills into civilian competencies. These services are provided through the Department of Defence’s Career Transition Assistance Scheme for up to 12 months after separation from the ADF.[18]

[1].          Australian Government, Budget strategy and outlook: budget paper no. 1: 2018–19, p. 6-24.

[2].          The budget figures in this brief have been taken from the following document unless otherwise sourced: Australian Government, Budget measures: budget paper no. 2: 2018–19, pp. 190–193.

[3].          Department of Veterans’ Affairs (DVA), Improved dental and allied health, factsheet, DVA, Canberra, 2018, pp. 1–3.

[4].          Ibid., p. 2.

[5].          Senate Foreign Affairs, Defence and Trade Committee, Answers to Questions on Notice, Veterans’ Affairs Portfolio, Additional Budget Estimates 2017–18, Question 58.

[6].          Ibid.

[7].          DVA, Delivering Australia’s digital future—Veteran Centric Reform—continuation, factsheet, DVA, Canberra, 2018, p. 1.

[8].          Senate Foreign Affairs, Defence and Trade References Committee, Mental health of Australian Defence Force members and veterans, The Senate, Canberra, March 2016, pp. 102–14.

[9].          Ibid., p. 116.   

[10].       Australian Public Service Commission (APSC), Capability review: Department of Veterans’ Affairs, APSC, Canberra, 5 December 2014.

[11].       Australian National Audit Office (ANAO), ‘Efficiency of veterans service delivery by the Department of Veterans’ Affairs’, ANAO website; Productivity Commission (PC), ‘Compensation and rehabilitation for veterans’, PC website.

[12].       Senate Foreign Affairs, Defence and Trade References Committee, The constant battle: suicide by veterans, The Senate, Canberra, August 2017, pp. 69, 100.

[13].       M Klapdor, ‘Veterans’ Affairs’, Budget review 2017–18, Research paper series, 2016–17, Parliamentary Library, Canberra, May 2017.

[14].       DVA, Mental health treatment for Australian Defence Force reservists with disaster relief and certain other service, factsheet, DVA, May 2018.

[15].       DVA, ‘7.7 Person has been incapacitated for a cumulative period exceeding 45 weeks’, Military Compensation MRCA Manuals and Resources Library, DVA website, last amended 10 August 2017.

[16].       DVA, ‘Support for veterans through improved compensation arrangements—removing the stepdown for incapacity payments—increased payments for veterans studying’, factsheet, DVA, May 2018.

[17].       DVA, ‘Support for veterans’ employment opportunities—continuation’, factsheet, DVA, May 2018; Australian Government, ‘Industry Advisory Committee on Veterans’ Employment’, Prime Minister’s Veterans’ Employment Program website, n.d.

[18].       DVA, ‘Support for veterans’ employment opportunities—continuation’, op. cit.


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