Step | Action |
1 | Comparable Foreign Payment (CFP) arrears lump sum
Information is received indicating a customer is entitled to arrears of a CFP. Before considering an arrears debt, code the ongoing foreign pension grant or revision of an existing foreign pension from the correct date. Note: when the start date of the ongoing pension is too far in the future to code, the arrears must be coded first on the Foreign Pension Details (FPD) screen. Has the ongoing rate of foreign pension been coded or is the date of effect of the ongoing rate too far in the future? - Yes, if appropriate, check a review date is set for coding of a future date. If the person is:
- No, see Foreign pension coding. Procedure ends here
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2 | Deceased customers
Generally, if the person who is entitled to the CFP is deceased at the time the overpayment is calculated, no arrears debt exists for either a person or their partner. However this assumes the person passed away before they could derive any benefit from the arrears. Staff must consider: If the person entitled to the CFP is deceased and did: - derive some benefit from the arrears amount, go to Step 3
- not derive any benefit from the arrears amount. No debt exists for either the person or their partner. Record all details on a DOC. For arrears from:
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3 | Information to be recorded
See the Residence and International Section intranet page for foreign country resources to convert Australian dollar amounts and code arrears periods. Information needed If there is insufficient information to apply any of the following, clarify details with the customer. Information may be accepted over the phone, but delegates must be satisfied the information being used is accurate and clearly documented. Note: if needed, any missing changes in the periodic rates of a foreign pension for the arrears periods (for example, for indexation), may be derived from the CFP Rate Calculator. Arrears period In all cases, obtain the arrears period: - Arrears Period Start Date (APSD). Foreign survivor payments are only assessed from the Bereavement Period End Date (BPED). In these cases, the APSD is adjusted to the BPED + 1
- Arrears Period End Date (APED). If the APED is unknown, use the end of the calendar month before the date of issue of the notice of grant (NOG)
Arrears amount or foreign pension rates If available, code the arrears period and lump sum amount in the source currency. However, do not use arrears amounts where: - the country only provides rate information and not an arrears amount
- the arrears amount provided is not the gross amount. For example, tax has been deducted or amount reduced for debt recovery
- the arrears amount includes components that are exempt from the income test for that country
- there are significant variations in the rates of the foreign pension, or
- policy adjusts the arrears period being assessed. For example, foreign survivor payments
If the arrears amount cannot be used, convert the rates during the arrears period to Australian dollars and code (like an ongoing foreign pension) for the arrears period. Exchange rate To make sure the debt reflects the value of foreign pension arrears the customer receives, policy is to use the exchange rate that was applicable at the date the arrears amount was received for the period of the arrears. When coding an arrears amount, system processing will automatically use the exchange rate applicable as at the date of event (DOV) coded. Otherwise, manually convert rates during the arrears period according to the applicable exchange rate and code in Australian dollars. Exchange rates are available on the Foreign Exchange Summary (RDFXS) screen. If the date of receipt of the arrears is unknown, it is deemed to be one of the following: - month of issue of the notice of grant (NOG)
- following month if the notice is issued within 5 days of the end of the month and it is in the customer's favour, or
- end of the arrears period + 1 for future grants. For example, Germany
If the customer or their partner receives a payment in the Newstart System (NSS), for example JobSeeker Payment (JSP), go to Step 5. Can the arrears amount be used? |
4 | Coding an arrears lump sum amount
Use the lump sum arrears amount to determine any CFP lump sum arrears debt. Process Direct
Go to the Foreign Income (FIPS) screen: - on the Foreign Pension Details (FPD) table, select Add New Row
- on Create Foreign Pensions Details, update:
- Country of Payment, same as for main pension
- Currency, same as for main pension
- Type, same as main payment
- Description, key ARREARS LUMP SUM
- Event Date, the date of receipt of the arrears lump sum. Note: on finalisation of the transaction, automated mainframe processing will modify the Event Date field to the Arrears Period Start Date (APSD), insert a new child entry with an Event Date equal to the Arrears Period End Date (APED) + 1, and set component rates to zero on the child entry
- Arrears From, key the APSD or the Bereavement Period End Date (BPED) + 1. Only change the date to the day after the BPED if the payment is a Survivor’s payment and APSD is on or before the BPED
- Arrears To, key the APED
- amounts, in the first field (for example, Basic Rate or NZ Actual), key the arrears lump sum amount in source currency. Reduce the amount recorded pro-rata if the payment is a Survivor’s payment, and the APSD is on or before the BPED
- select Save
- update these fields:
- Receipt Date
- Channel
- Service Reason. If the system does not select a default Service Reason, select the most relevant Service Reason for the update
- go to Step 9
Customer First/Customer Record
Go to the FPD screen. In these fields: - Country of Payment and Type as for the main pension
- Description 1, key Arrears Lump Sum
- Currency, key the source currency of the lump sum
- Date of Event, key the date of receipt of the arrears lump sum > [Enter]. Note: automated mainframe processing will:
- modify the Event Date field to the Arrears Period Start Date (APSD)
- insert a new page with an Event Date equal to the Arrears Period End Date (APED) + 1, and
- set component rates to zero on the new page
- Arrears From, key the APSD or the Bereavement Period End Date (BPED) + 1. Only change the date to the day after the BPED if the:
- payment is a Survivor’s payment, and
- APSD is on or before the BPED
- Arrears To, key the APED
- amounts, in the first field (for example, Basic Rate or NZ Actual), key the arrears lump sum amount in source currency. Reduce the amount recorded pro-rata if the:
- payment is a Survivor’s payment, and
- APSD is on or before the BPED
- Source and DOR, key as applicable
- press [Enter]
- go to Step 9
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5 | Arrears due to a new grant of a foreign pension
Are the arrears because of a new grant of a foreign pension? |
6 | Code rates during the arrears period
Use the rate at grant, and subsequent rate changes, to determine any CFP lump sum arrears debt. Process Direct
Go to the Foreign Income/Pensions Summary (FIPS) screen: - Expand, select
 at relevant row - select Add New Row
- on Create Foreign Pensions Details update:
- Event Date, key the Arrears Period Start Date (APSD) or Bereavement Period End Date (BPED) + 1. Only change the date to the day after the BPED if the payment is a Survivor’s payment and the APSD is on or before the BPED
- Currency, select AUD. Note: where the determined exchange rate to be used is within 5% of the existing rate, use UK currency (GBP)
- Exchange Rate, key the determined exchange rate (from Step 3)
- Frequency, select relevant option, according to ongoing foreign pension
- relevant income fields (for example, Basic Amount or Social/Welfare Amt), key the rate information as provided on notice of grant/customer advice/liaison, from the APSD or BPED + 1 as appropriate
- update these fields:
- Receipt Date
- Channel
- Service Reason. If the system does not select a default Service Reason, select the most relevant Service Reason for the update
- select Save
- select Assess and address any errors/warnings. Ignore the warning about the incorrect currency/exchange rates
- return to the relevant foreign pension record on the FPD table again and code all rate variations during the arrears period
- if there is a gap between the end of the arrears period and the date of effect of the original NOG coding, code:
- Event Date, Arrears Period End Date (APED) + 1
- key 0 in the relevant income field (for example. Basic Rate or Social/Welfare Amount)
- go to Step 9
Customer First/Customer Record
Go to the Foreign Income/Pensions Summary (FIPS) screen: - 'S'elect the relevant foreign pension record to go to the Foreign Pension Detail (FPD) screen. In these fields:
- Event Date, key the Arrears Period Start Date (APSD) or the Bereavement Period End Date (BPED) + 1. Only change the date to the day after the BPED if the payment is a Survivor’s payment and the APSD is on or before the BPED
- Currency, key as AUD. Note: where the determined exchange rate to be used is within 5% of the existing rate, use UK currency (GBP)
- Exchange Rate, key the determined exchange rate (from Step 3)
- relevant income fields (for example, Basic Amount or Social/Welfare Amt), key the rate information as provided on notice of grant/customer advice/liaison, from the APSD or BPED + 1 as appropriate
- Frequency, according to ongoing foreign pension
- Source and DOR, key as applicable
- press [Enter]. Ignore the warning about the incorrect currency/exchange rates
- on the FIPS screen, 'S'elect the relevant foreign pension record
- code all rate variations during the arrears period. If there is a gap between the end of the arrears period and the date of effect of the original NOG coding, in the:
- Event Date, key the APED + 1
- relevant income fields (for example. Basic Rate or Social/Welfare Amount), key the rate information as provided on notice of grant/customer advice/liaison, from the APSD or BPED + 1 as appropriate
Go to Step 9. |
7 | Arrears because of foreign pension rate increases
Due to system limitations, only the difference between the existing rate and the new rate is coded separately. Before coding, manually apply any concessional treatment of foreign pensions, see International Social Security Agreements. Determine: - rates of foreign pension for the arrears period, taking into account any concessional treatment
- difference between the existing rate of foreign pension and the new rates for the period of the arrears
Note: if the period of arrears for the rate revision applies for a period where no rate was applicable due to previous date of effect and arrears debt calculations, assume the rate of foreign pension continued to apply for that period. |
8 | Coding the arrears after a rate increase
Use the arrears amount to determine any CFP debt due to rate increase. Process Direct
Go to the Foreign Income (FIPS) screen: - on the Foreign Income/Asset Detail (FID) table, select Add New Row
- on Create Foreign Financials update:
- Country of Payment
- Currency, AUD Australian Dollar. If the determined exchange rate to be used is within 5% of the existing rate, use UK currency (GBP)
- Exchange Rate, key the determined exchange rate (from Step 3)
- Type, OIN - Other Income
- Frequency, select relevant option
- Reference/Description, key XX YYY Rate Revision Arrears (where XX is the relevant 2-digit country code and YYY is the foreign payment type)
- Start Date, dd/mm/yyyy
- End Date, dd/mm/yyyy
- key any other relevant fields
- select Save
- update these fields:
- Receipt Date
- Channel
- Service Reason. If the system does not select a default Service Reason, select the most relevant Service Reason for the update
- select Save
- select Assess and address any errors/warnings. Ignore the warning about the incorrect currency/exchange rates
- return to the relevant Foreign Income/Assets on the FID table again and code all rate variations during the arrears period
- select the relevant Foreign Income/Assets on the FID table again and code:
- Event Date, Arrears Period End Date (APED) + 1
- Income Amt, key 0
Is the customer a non-protected SCV holder paid a direct deduction rate of Australian pension under the NZ Agreement who receives an NZ pension and has been granted a third country pension (3CP)? Customer First/Customer Record
Go to the Foreign Income Details (FID) screen, code as follows: - Country of Payment
- Type, key OIN
- Reference/Description, key XX YYY Rate Revision Arrears (where XX is the relevant 2 digit country code and YYY is the foreign payment type)
- Event Date, key the arrears period start date
- Currency, key AU. If the determined exchange rate to be used is within 5% of the existing rate, use UK currency (GBP)
- Exchange Rate, key the determined exchange rate (from Step 3)
- Income Amt, key the difference between the existing rate of foreign pension and the new rates
- Source and DOR, key as applicable
- press [Enter]. Ignore the warning about the incorrect currency/exchange rates.
- update the FIPS screen:
- 'S'elect the relevant record
- code all rate variations during the arrears period
- 'S'elect the relevant record again and in these fields:
- Event Date, key the Arrears Period End Date (APED) + 1
- Income Amt, key 0
Is the customer a non-protected SCV holder paid a direct deduction rate of Australian pension under the NZ Agreement who receives an NZ pension and has been granted a third country pension (3CP)? |
9 | New Zealand (NZ) Assumed Rate (ASR)
Code an Assumed Rate (ASR) of NZ pension. See New Zealand Agreement and foreign pension information. Make sure the customer meets all of the following: - is a non-protected SCV holder
- paid a direct deduction rate of Australian pension under the NZ Agreement
- receives an NZ pension, and
- has been granted a third country pension (3CP)
Check if the 3CP is: - less than the NZ pension and NZ has:
- already adjusted their NZ pension because of the 3CP, code 3CP from date NZ pension changed
- not adjusted their NZ pension because of the 3CP, code 3CP and an NZ Assumed Rate from T for today
- see Foreign pension coding. Procedure ends here
- more than the NZ pension and NZ has:
- already adjusted their NZ pension because of the 3CP, code 3CP from normal date of effect ensuring NZ pension has been adjusted from that date
- not adjusted their NZ pension because of the 3CP, code 3CP and an NZ Actual Rate of zero from normal date of effect of the 3CP and for the period of the arrears debt (APSD)
- select Assess, address any errors/warnings
- go to Step 10
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10 | Overpayments and debts
Note: foreign pension arrears that are identified as being received before 1 July 2004 are treated differently. Arrears debts before this date can only be raised under an international social security agreement if the foreign pension was covered by an agreement in force at the time and only for the customer. Negative adjustments of: - less than the small debt waiver threshold are automatically waived. However, adjustments before a limiting date must be manually calculated
- equal to or above the small debt waiver threshold should be reviewed to make sure there are no unanticipated adjustments during or outside the debt period
Process Direct
Finalise the transaction by selecting Assess again. The Entitlements (ELD) screen will display. Is there a recoverable debt equal to or above the small debt waiver threshold? - Yes:
- go to the Assessment Consequences (ASC) screen
- make sure the Debt Action field is coded as Investigation Required before finalising the transaction
- go to Step 11
- No, finalise the activity. Select Finish. Record details of the update on Finalise.
If the CFP was from:- New Zealand, see Table 2 in New Zealand embargoes. Procedure ends here
- any other country, record all the details on a Note/DOC. Procedure ends here
Customer First/Customer Record
Go to the Assessment Results (AR) screen and check any negative adjustments. Is there a recoverable debt equal to or above the small debt waiver threshold? - Yes:
- on the Assessment Consequences (ASC) screen, in the Dbt Act field, key INV
- finalise the activity
- go to Step 11
- No, finalise the activity. If the CFP was from:
- New Zealand, see Table 2 in New Zealand embargoes. Procedure ends here
- any other country, record all details on a DOC. Procedure ends here
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11 | Record CFP arrears debts
Arrears debts for customers and partners from any country besides New Zealand (NZ) are raised and recovered according to general debt procedures. Arrears debts because of the grant of an NZ pension may be recovered by embargo. Consider waiver provisions if there has been a significant delay in processing times. See Investigating administrative or computer error debts for Social Security payments and Waiving Centrelink debts. Is the arrears debt due to the coding of arrears of NZ pension from the grant of a NZ new claim and not a failed embargo? |
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