Changing compensation debt details for customers in special circumstances 117-04020020

Before there can be a change to the compensation debt:

• check the customer's special circumstance review has been completed
• the decision has been recorded in a DOC, and/or
• the decision has been scanned to customer's file

Does the debt need to be changed?

• Yes, go to Step 2
• No, change the preclusion period only. See Changing compensation preclusion period details for customers in special circumstances

Staff must delete the previous lump sum coding and debt from Compensation Management System (CMS), and zero the debt in the Debt Management and Information System (DMIS). Not completing this step first will cause a negative adjustment.

Do not recalculate the debt on the same day the debt is deleted in DMIS. This may take 24 hours for the debt to be reset to zero.

• Delete the lump sum
• Print a copy of the Component Amount (OPCA) and Lump Sum Assessment Results (CMAR) screens for breakdown of compensation debts
• Select the Claim ID from the Claim Summary
• Select Lump Sum Payments
• Select Delete Lump Sum by ticking the box
• Select Continue
• Record details on a DOC

Go to Step 3.

Check DMIS to ensure the compensation debt has reset to zero. If not, manually adjust the debt to ‘no debt’:

• Go to the Debt List (OPDL) screen - select the compensation debt
• Next: field – key OPDA
• Reason code: field - key relevant code, or select valid codes from drop down box (for example, 'ARO' - Result of ARO review, 'UER' - User error, 'FIG' - further information given)
• Amount: field – key 0.00
• Notes: field - key reason for deletion, for example, 'due to further information received debt has been deemed "no debt" and will be recalculated'

Go to Step 4.

If the lump sum settled:

• out of court settlement or by consent judgment, go to Step 5
• was a ruling made by a judge or tribunal, go to Step 6

For consent settlements, the amount to be disregarded must be deducted from the total gross lump sum amount:

• Determine the original gross lump sum amount (as per the Gross Settlement Amount: field on the Lump Sum Payments screen, or the settlement papers)
• Deduct the amount to be disregarded
• If this debt is being recalculated, the value for the 'amount to be disregarded' will be recorded in the DOC of the review
• Apply the 50% rule to the reduced lump sum amount

The result of this calculation is the (amended) compensation part to be used to recalculate the social security debt.

Go to Step 7.

For judgment/verdict settlements, the amount to be disregarded must be deducted from the total economic loss amount:

• Use the amount awarded for economic loss as specified in the judgment
• Calculate the compensation part by totalling the amounts that have been awarded for:
• past and future economic loss, plus
• interest awarded on past economic loss, plus
• loss of superannuation contributions, plus
• interest on superannuation, less
• any amount of periodic compensation to be repaid

The amount awarded for economic loss in the judgment, and the amount calculated as the compensation part may not necessarily be the same dollar amounts.

Deduct the amount to be disregarded. The remaining total is then divided by the relevant divisor applicable at the date of settlement.

Go to the Lump Sum Payments screen and code the following:

• Incident Date
• Lump Sum Payments
• Edit Lump Sum
• Complete the following fields:
• Settlement Date - should show the date of the settlement (no change)
• Settlement Type - should show the relevant code
• Gross Settlement Amount - code the compensation payment amount
• Payback of Periodic Compensation
• Economic Loss amount - code the amount calculated
• Change Reason - select valid option from drop down box
• Issue Advice must be 'Manual advice issued' or 'No advice issued'
• Complete the Source and Receipt Date
• Select Continue. The Lump Sum Assessment Results screen will show
• Check CMAR has included all payments in the preclusion period
• Add any supplementary payments (where applicable), for example, $600 Carer Supplement
• Complete Source and Receipt Date
• Select Continue
• The Assessment Results (AR) screen will show
• Select Submit to finalise the debt

The Divisor Amount will display the Lump Sum Divisor figure used and the Preclusion Period will show the calculated preclusion period.

• The calculated debt amount and the preclusion period will show on the Lump Sum Assessment Results screen
• The results of the debt are displayed in the following fields:
• Gross Settlement Amount
• Economic Loss Amount
• Divisor Amount
• Charge Amount
• Charge Period
• Preclusion Period will show the calculated preclusion period
• Finalise the debt activity via the Lump Sum Assessment Results screen by selecting the appropriate action in the Finished: field
• Go to the OPDL screen and select the debt
• Next: field key OPCA
• Adjust OPCA payment components where required

If the charge is nil, the debt activity will be automatically finalised via the Lump Sum Assessment Results screen and will show on the claimant's Activity List (AL) screen.

If the activity does not appear on the Activity List (AL) screen, run the Daily Driver by entering DDR in the Next: field.

If the previous debt has not been fully recovered, the debt amount is reduced, not waived.

Is the debt to be waived under s1184K?

• Yes, go to Step 9
• No, go to Step 10

If the review determines the debt should be waived:

• Select the Debt ID to be waived from the Debt List (OPDL) screen
• Press [Enter]
• Go to the Add Waiver (OPWAA) screen and complete the following fields:
• Debt Amount Waived $ - key the amount to be waived
• S1184K Reason Waived - enter relevant code from drop down box
• Comments, code a brief explanation why debt is waived
• Press [Enter]
• On the Assessment Finalisation (OPAF) screen, finalise the debt

Go to Step 10.

Make genuine attempts to contact the person by phone to advise them of the decision.

There are language and interpreter services available for customers who may need an:

• Immediate telephone interpreter
• Indigenous language interpreter

See Interpreter Services.

Finalise the appeal using the Internal Review/Explanation script and send the Q449 'To Customer - SME unable to contact/Refer to ARO' letter.

Go to Step 11.

It will be necessary to reverse any tax or payment summary adjustment which was done for the original debt.

Check if the customer's tax details need to be adjusted.

Check the Component Amount (OPCA) screen and ensure the debt raised is apportioned for the financial years for which the compensation affected payment (CAP) was paid and is also broken down by component.

Go to Step 12.

Record details of the decision in a DOC including any changes to the lump sum preclusion period debt amount and debt waiver. Include the period of the debt and tax adjustment.

See Minimum DOC standards for debt waivers.

Is the debt over recovered?

• Yes, go to Step 13
• No, procedure ends here

• Refund any recovered debt amount that represents payments made in the period waived under Section 1184K
• If the record has an over-recovered compensation debt, the refund is payable to the customer
• Prepare the SF030. See Resources for a link to the Notice to prepare Refund Account (SF030) form

Go to Step 14.

Do not include multiple requests in the same form.

• Prepare a refund request using the Notice to prepare a Refund Account (SF030) form
• Print the form and complete the remaining sections
• Add the name of DMO, signature and date signed
• Add the name of spending delegate (APS5 or above), signature, date signed and position details
• Scan the signed form and save as a PDF
• Email the prepared PDF SF030 form to Financial Shared Services, cc the spending delegate. The Accounts Payable team will process the refund
• Record details on a DOC