DFWA – Independent Inquiry into DFRDB Commutation Arrangements Welcomed

The Defence Force Welfare Association (DFWA) and ADSO welcomes the Government’s announcement yesterday that it would finally commission an independent inquiry into the commutation arrangements of the Defence Force Retirement and Death Benefits (DFRDB) superannuation scheme.

In commenting on the announcement, the National President of DFWA, Kel Ryan, stated that he particularly welcomed the Government emphasising the importance of open and transparent discussion around veteran concerns, and that it would consult with the ex-service community about the Terms of Reference for the inquiry.

As for the commutation arrangements, Kel Ryan stated that DFWA and the veterans community as a whole had long sought redress of varying grievances relating to DFRDB, not the least of which included the continued application in 2019 of out-of-date 1962 life tables for calculating both commutation entitlements and fortnightly superannuation payments made to veterans subject to the DFRDB scheme.

Hopefully, the proposed inquiry will uncover the serious financial injustices that those out-dated life tables have caused to DFRDB superannuants. Life expectancies have markedly increased from the time since the DFRDB scheme was introduced in 1973. Those increases have meant that the amount of permanent pension reduction calculated using old tables is far higher than they should be if current tables applied.

The Defence Force Welfare Association, along with its partners in the Alliance of Defence Service Organisations, will be making written submissions to the inquiry and looks forward to actively participating in drafting the Terms of Reference.
26th March 2019

DFWA – Voice of the Defence Community

Media Alert
It is believed that the ABC TV’s 7.30 pm Report on Wednesday 27th March 2019 will include an article on the subject DFRDB Commutation

Comment. If you or your spouse have or had a DFRDB superannuation pension, particularly if you commuted, this inquiry will be worth watching. The ToR will be interesting. An adjustment to pensions based on the correct life expectancy at the time of a DFRDB member’s separation from the ADF should be achievable. In most cases, the adjustment would be modest but would recognise and redress the fundamental flaw in the original 1973 DFRDB Act’s use of outdated and biased life expectancy tables, which seriously disadvantage all DFRDB superannuation pension recipients who chose to commute (some 98% of all DFRDB super pensioners).

Comments

  1. Clive Bentley says

    As an ex RAAF member on a DFRDB pension I am sure that when I commuted there was documentation to the effect that once you reached the age of 72 or a certain number of years your commutation would have been repaid and you would revert to the full uncommuted pension.
    I have searched for the said documentation but unfortunately cannot find it.

  2. Colin Alexander says

    So pleased that at last there is recognition of this fully justified concern of Veterans. Whether the Government Inquiry determines commutation as being enforced is legal or not, it will not change the fact that it is a disrespectful act by Parliament. Making Veterans and their spouses pay, until they have both died, for reassimilation into society is bad enough. Being forced to repay the initial amount offered, many times over, is utterly reprehensible. To anyone proposing to state such an obligation to retiring Veterans they would have been very aware of the likely body language response they could expect. In all other areas of society such an act would be considered illegal. Had we known at the time of such an obligation the offer would have been rejected and a loan obtained from a bank.