|
Post by Banjo on Jan 31, 2015 7:53:06 GMT 7
Centrelink pension denied after Canberra man spends compensation on TV, fishing gear and pool tableA Canberra man who was awarded more than $1 million in compensation after injuring himself during a football half-time show spent almost all his compensation within weeks, a tribunal has heard. The Administrative Appeals Tribunal ruled many of his purchases were "unwise, irresponsible and unnecessary". In 2008, Jason Cooper broke his neck while diving to catch a football using a milk crate and was no longer able to work as a tiler. It was the incident that helped spark the end of audience participation during the half-time break at Canberra Raiders home games. Mr Cooper was placed on a Disability Support Pension but was eventually awarded damages totalling $1,025,000 and last year received just over half that amount in settlements. But the Administrative Appeals Tribunal heard that within four months Mr Cooper had spent almost all of it. He paid back a number of personal loans, as well as bought a house on the south coast and filled it with new furniture. Thousands of dollars were also spent on fishing gear, home entertainment and model cars. Under cross-examination Mr Cooper agreed many of the items he bought were not necessities. However, he stated that as he was unable to work, he needed a good quality stereo system and television, a pool table and games machine to help occupy his time. The tribunal heard he now had four television sets in the house. Although Mr Cooper had spent most of his money, Centrelink did not want to allow him immediately back onto the pension. When Mr Cooper was awarded the $1 million, Centrelink cancelled his payments and calculated he would not need government support again until at least September 2017, known as a preclusion period. When Mr Cooper appealed that decision, Centrelink took the matter to the tribunal, arguing Mr Cooper did not meet the special circumstances required. The tribunal agreed, finding "he made unwise, irresponsible and unnecessary decisions in a situation where he was aware of the necessity to use the settlement money in a sensible manner and to set aside sufficient funds to meet his living costs during the preclusion period". www.abc.net.au/news/2015-01-31/centrelink-pension-refused-after-football-compensation-spent/6059346
|
|
|
Post by Banjo on Jan 31, 2015 7:57:29 GMT 7
Financial genius Banjo (currently living in Thailand with about 2 cents to his name), occasionally gets asked by members expecting compensation payments how it will affect their pensions. I can only advise them to seek advice, as in good professional advice, in how to use the money best while retaining their payments.
|
|
|
Post by gomaz on Jan 31, 2015 8:07:30 GMT 7
Banjo, where would you suggest that one could seek such advise.
|
|
|
Post by scallywag on Jan 31, 2015 8:24:44 GMT 7
|
|
|
Post by ghostbuster on Jan 31, 2015 9:34:33 GMT 7
When i received my compo i said nothing and it was sweet.
|
|
|
Post by scallywag on Jan 31, 2015 9:39:36 GMT 7
When i received my compo i said nothing and it was sweet. If you are saying you didn't notify clink of changes in your circumstances, that's up to you but I wouldn't go bragging about it.
|
|
|
Post by Banjo on Jan 31, 2015 9:47:52 GMT 7
AS said, most compo claims involve a solicitor so he would be the best person to ask. I can refer people to a member who was in a similar situation and seemed to come out of it OK.
|
|
|
Post by zorro1 on Feb 1, 2015 10:05:07 GMT 7
When i received my compo i said nothing and it was sweet. Thats crazy they can still review you at any time and ask for your bank records. When I applied for the DSP I made the choice to tell them about property I owned in Thailand and even after an ' international' appraisal they never gave me any grief about it. Its always best to be honest about hard cash unless of course you have it hidden under the bed
|
|
Deleted
Deleted Member
Posts: 0
|
Post by Deleted on Feb 2, 2015 7:25:06 GMT 7
CL also have financial advisers that will help with advice.
|
|
|
Post by Banjo on Feb 2, 2015 7:33:30 GMT 7
The problem is getting to those people, when I sold my house I was told on the phone that I had to spend the money before I'd get back on the pension. In the end a more reasonable officer told me just to make a verbal statement that I intended to buy another one.
|
|
|
Post by gomaz on Feb 9, 2015 15:43:26 GMT 7
The problem is getting to those people, when I sold my house I was told on the phone that I had to spend the money before I'd get back on the pension. In the end a more reasonable officer told me just to make a verbal statement that I intended to buy another one. Banjo were you on the DSP when the house was sold?
|
|
|
Post by Banjo on Feb 9, 2015 15:51:36 GMT 7
Yes, they were going to take me off it. Well that was the threat from the first officer anyway.
|
|
|
Post by gomaz on Feb 10, 2015 13:24:17 GMT 7
I would have thought that it would have been added to your liquid assets and deemed.
I will be receiving a couple of hundred g due to the sale of an inherited property in the near future I hope they don't want to play silly buggers with my DSP.
|
|
|
Post by Banjo on Apr 1, 2015 20:38:15 GMT 7
Q: I have been awarded a workers' compensation payment "for past loss of earnings".
I have been informed by letter from Centrelink that I will be excluded from any Centrelink benefits and health card until I am 66.5 years old. I will be 65 this August and my condition does not allow me to return to work.
My wife does not work, does not receive any Centrelink benefits and will be 65 in March next year. At the moment she has $450,000 in super and $40,000 in the bank in her name. We have $110,000 in the bank jointly, $100,000 being the compensation payment.
We own our home and have no further assets. This has been an unexpected event and we would like some advice of how to handle this matter.
I have worked most of my life as a tradesman shipwright/boilermaker/welder and, for the past five years, we have lived on weekly WorkCover payments and our savings. J.O.A: It sounds like you were receiving "periodic compensation" from WorkCover before receiving the "lump sum compensation".
Centrelink is required by law to take compensation payments into account when determining eligibility for most Centrelink payments, including the Age and Disability Support pensions and Newstart allowance. The intention is to prevent people receiving both compensation and Centrelink payments for a "preclusion" period during which they are expected to live on the lump sum payment.
The preclusion period depends on whether the lump sum was obtained by consent, following a claim related to lost earnings or lost earning capacity. In such cases, Centrelink counts only 50 per cent of the lump sum (known a the "compensation part") to calculate the number of weeks in the preclusion period.
This amount is then divided by the income test's cut-off limit for a single pension, currently $934.30 a week i.e. the income above which the age pension phases out. To find your preclusion period, take 50 per cent of your lump sum i.e. $50,000 and divide this by $934.30, which equals 53 weeks.
Since you were receiving periodic compensation payments prior to receiving the lump sum, the preclusion period begins on the day after your WorkCover payments stopped.
However, even during a preclusion period, you may still apply for a Carer Allowance, Mobility Allowance, Commonwealth Seniors Health Card, Disaster Relief Payment, Family Tax Benefit. Your wife is not precluded and may receive Centrelink payments under standard conditions, subject to the assets and income tests as a couple.
Note that one section of the law (S1184K) allows Centrelink the discretion to disregard all or part of a compensation payment in special circumstances but only if your situation is so unusual, uncommon or exceptional that the usual application of the preclusion period would appear unduly harsh. www.smh.com.au/money/saving/saving-up-for-the-grandkids-20150401-1mchrw.html
|
|
|
Post by ding on May 5, 2015 4:28:14 GMT 7
I went through something similar. By the time my case went to court and was settled I have been receiving centrelink assistance but using credit cards to pay the things centrelink didn;t cover. Like mortgage, electricity and phones and various expenses related to the businesses I had prior to the hit and run.
So after the reasonable settlement, the solicitors and medical fees took around half. Credit card bills took around $40,000. It's amazing how quickly they mount up when you're using a credit card to pay itself off each month :-)
I decided the sensible thing to do was pay off the mortgage so I would have a place to live because rents here were close to $300 a week even for a one room flat.
The you get to the things you actually 'have to replace'. Most of my 'stuff' was accumulated for business, and was pretty well useless for personal use. I replaced my main vehicle with one more suited to a reduced mobility lifestyle, and got rid of the others at a loss. Because I obviously couldn't make lease payments, but I still had months of the preclusion period where I had to live frugally as possible.
I was put on DSP effectively by the court system, rather than personal decision to apply. Of course I had to make the application, but the medical stuff was all based on court documents. Which is why I'm never sure what would happen if I needed to be reassessed under new rules for portability.
In the end I came out with around $30,000 in the bank. About 2 years pension in those days. I lost a third of it in a cyclone.
So as the post suggests, if you are not already a pensioner and you are about to receive a payout - think carefully before you plan to spend your compo.
It is better to have a stack of money in the bank and pay yourself maybe the equivalent of the pension plus 50% for a while until it gets down to the point where pension cuts in, than to spend it all on fun new stuff, then discover the exhilirating thrills of a life of DSP budgeting.
If you think the Aussie budget is tough - wait until you have to decide if you will eat - or pay for the electricity to cook!
:-)
|
|