Clean Energy (Household Assistance Amendments) Act 2011 (141 of 2011)
Schedule 3 Clean energy payments under the Veterans' Entitlements Act
Part 3 Indexation
Veterans' Entitlements Act 1986
57 After section 198M
Insert:
198MA Adjustment of indexation factor under section 59D for limited time on and after 20 March 2013 for certain purposes
Application
(1) This section applies for purposes connected with the following payments on or after 20 March 2013:
(a) a service pension;
(b) seniors supplement;
(c) a pension under Part II or IV at a rate determined under or by reference to Division 4 of Part II or subsection 30(1);
(d) Special Rate Disability Pension under the MRCA;
(e) compensation under Division 2 (Compensation for member's death for wholly dependent partners) of Part 2 of Chapter 5 of the MRCA.
Note 1: Section 198 of the MRCA sets Special Rate Disability Pension by reference to the rate of pension under section 24 of this Act (so indexation of amounts affecting that rate also affects that pension).
Note 2: Division 2 of Part 2 of Chapter 5 of the MRCA sets compensation under that Division by reference to the rate of pension under subsection 30(1) of this Act (so indexation of amounts affecting that rate also affects the compensation).
Adjustment of indexation factor
(2) An indexation factor that:
(a) is worked out under section 59D on a day that is on or after 20 March 2013; and
(b) is directly or indirectly relevant to the indexation of an amount provided for by:
(i) subsection 5GA(1) (which provides for the PS rate mentioned in table item 2 of section 59A); or
(ii) subsection 5GA(2) (which provides for the PS minimum rate mentioned in table item 2A of section 59A); or
(iii) subsection 5GA(4) (which provides for the PS basic rate mentioned in table item 2B of section 59A); or
(iv) subsection 22(3) or (4), 23(4) or 24(4); or
(v) paragraph 30(1)(a) or (b); or
(vi) table item 2 of point SCH6-B1 of the Rate Calculator (which provides for the pension MBR mentioned in table item 1 of section 59A);
is, for the purposes of the indexation of such an amount on that day, to be reduced by the brought-forward CPI indexation amount, but not below 1.
Note 1: An indexation factor worked out under section 59D is indirectly relevant to the indexation of an amount provided for by subsection 22(3) or (4), 23(4) or 24(4) or paragraph 30(1)(b). This is because:
(a) section 198 provides for indexation of such an amount by reference to the pension MBR factor worked out under section 59LA; and
(b) the pension MBR factor depends on the increase in the single pension rate MBR amount, which in turn depends (under section 59G) on indexation of the pension MBR amount under section 59C, which involves the indexation factor worked out under section 59D.
Note 2: An indexation factor worked out under section 59D is indirectly relevant to the indexation of an amount provided for by paragraph 30(1)(a). This is because that amount is affected by indexation under section 59G, which in turn depends on indexation under section 59C.
Note 3: Once the brought-forward CPI indexation amount becomes 0, there will be no further reduction of the indexation factor.
Example: Assume that the indexation factor worked out under section 59D on 20 March 2013 is 1.005. The brought-forward CPI indexation amount in relation to 20 March 2013 is 0.007 (as there has been no previous reduction). That indexation factor is reduced to 1 on 20 March 2013.
Further assume that on 20 September 2013 the indexation factor is 1.010. The brought-forward CPI indexation amount in relation to 20 September 2013 is 0.002. That indexation factor is reduced to 1.008 on 20 September 2013.
The brought-forward CPI indexation amount in relation to later indexation days is now 0 so there is no further reduction of the indexation factor.
Definition of brought-forward CPI indexation amount
(3) In this section:
brought-forward CPI indexation amount for a day means:
(a) 0.007 less any reduction made under subsection (2) for an earlier day; or
(b) 0 if the brought-forward PBLCI indexation amount for the day under section 198MB is 0.
198MB Adjustment of living cost indexation factor for limited time on and after 20 March 2013 for certain purposes
Application
(1) This section applies for purposes connected with the following payments on or after 20 March 2013:
(a) a service pension;
(b) a pension under Part II or IV at a rate determined under or by reference to section 22, 23 or 24 or subsection 30(1);
(c) Special Rate Disability Pension under the MRCA;
(d) compensation under Division 2 (Compensation for member's death for wholly dependent partners) of Part 2 of Chapter 5 of the MRCA.
Note 1: Section 198 of the MRCA sets Special Rate Disability Pension by reference to the rate of pension under section 24 of this Act (so indexation of amounts affecting that rate also affects that pension).
Note 2: Division 2 of Part 2 of Chapter 5 of the MRCA sets compensation under that Division by reference to the rate of pension under subsection 30(1) of this Act (so indexation of amounts affecting that rate also affects the compensation).
Adjustment of living cost indexation factor
(2) A living cost indexation factor that:
(a) is worked out under section 59EAB on a day that is on or after 20 March 2013; and
(b) is directly or indirectly relevant to the indexation of an amount provided for by:
(i) subsection 22(3) or (4), 23(4) or 24(4); or
(ii) paragraph 30(1)(a) or (b); or
(iii) table item 2 of point SCH6-B1 of the Rate Calculator (which provides for the pension MBR mentioned in table item 1 of section 59A);
is, for the purposes of the indexation of such an amount on that day, to be reduced by the brought-forward PBLCI indexation amount, but not below 1.
Note 1: A living cost indexation factor worked out under section 59EAB is indirectly relevant to the indexation of an amount provided for by subsection 22(3) or (4), 23(4) or 24(4) or paragraph 30(1)(b). This is because:
(a) section 198 provides for indexation of such an amount by reference to the pension MBR factor worked out under section 59LA; and
(b) the pension MBR factor depends on the increase in the single pension rate MBR amount, which in turn depends (under section 59G) on indexation of the pension MBR amount under section 59C, which may involve the living cost indexation factor worked out under section 59EAB.
Note 2: A living cost indexation factor worked out under section 59EAB is indirectly relevant to the indexation of an amount provided for by paragraph 30(1)(a). This is because that amount is affected by indexation under section 59G, which in turn depends on indexation under section 59C.
Note 3: Once the brought-forward PBLCI indexation amount becomes 0, there will be no further reduction of the living cost indexation factor.
Example: Assume that the living cost indexation factor worked out under section 59EAB on 20 March 2013 is 1.005. The brought-forward PBLCI indexation amount in relation to 20 March 2013 is 0.007 (as there has been no previous reduction). That living cost indexation factor is reduced to 1 on 20 March 2013.
Further assume that on 20 September 2013 the living cost indexation factor is 1.010. The brought-forward PBLCI indexation amount in relation to 20 September 2013 is 0.002. That living cost indexation factor is reduced to 1.008 on 20 September 2013.
The brought-forward PBLCI indexation amount in relation to later indexation days is now 0 so there is no further reduction of the indexation factor.
Definition of brought-forward PBLCI indexation amount
(3) In this section:
brought-forward PBLCI indexation amount for a day means:
(a) 0.007 less any reduction made under subsection (2) for an earlier day; or
(b) 0 if the brought-forward CPI indexation amount for the day under section 198MA is 0.