22 June 2020 - HIGHER DFRDB SUPERANNUATION PENSION INCREASE.  DFWA advises that the latest DFRDB superannuation pension increase to take effect 2 July 2020, for those aged over 55, is 1.5%. This compares to the CPI rate of just 1.0% and which will be applied to other Government superannuation schemes such as PSS etc. This is a direct result of the campaign waged by DFWA over many years and which in 2014 saw the Government agree to applying the higher of CPI or wages growth to those DFRDB recipients aged over 55. The battle continues to extend this arrangement to ALL military superannuation schemes and without the age restriction.

19 September 2019 - Letter to Jim Hislop of the Australian Defence Force Retirees Association. Kel Ryan wrote a letter to Jim Hislop to respond to some concerns raised in the ADFRA September update.

11 December 2019 - OMBUDSMAN INQUIRY INTO DFRDB.   The Commonwealth Ombudsman’s office has released a Media Statement on the outcome of his inquiry into DFRDB Commutation which can be accessed on the Ombudsman’s website.  The full report is also available on the website.  The Ombudsman found that many members were given misleading and incorrect advice about commutation by Defence.

20 May 2019 - OMBUDSMAN INQUIRY INTO THE DFRDB.  On 25 March 2019 the Minister for Veterans Affairs announced an Independent Inquiry into the Administration of the DFRDB scheme to be undertaken by the Ombudsman (see post below).

On 25 May 2019 the Ombudsman announced its “own motion’ or internal investigation limited to the accuracy of information provided to DFRDB scheme members by scheme administrators, particularly in relation to commutation. The Ombudsman must be guided by what is in the legislation only. The Ombudsman has since then called for submissions from scheme members in relation to commutation – remember this is the limit of its investigation.

DFWA encourages scheme members to respond to the Ombudsman’s Questionnaire. Do not be dissuaded by the limited space on the form but make a separate submission if necessary. Be constructive and considered in your responses. 

In the meantime, the DFWA has written to the Ombudsman seeking clarification of the extent of its investigation and are developing, along with ADSO, draft Terms of Reference (ToRs) for the Independent Inquiry that will be put to the Minister at the earliest opportunity. The immediate constraint we have is that the Prime Minister is yet to announce his Ministry and who will be the Minister for Veterans’ Affairs. In the meantime, the ToRs will be developed and ready for the first opportunity meeting with the incoming Minister for Veterans’ Affairs.


26 March 2019 - INQUIRY INTO THE DEFENCE FORCE RETIREMENT AND DEATH BENEFITS SCHEME COMMUTATION ARRANGEMENTS  The Government has advised it will commission an independent inquiry to examine the information provided by scheme administrators and relevant departments to members of the Defence Force Retirement and Death Benefits (DFRDB) superannuation scheme. The DFRDB scheme, which was established in 1972 and closed to new members in 1991, allowed members to commute (exchange) part of their pension for a lump sum. The Government will consult with the ex-service community about the terms of reference for the inquiry, as well as panel membership.  Ex-Service Organisations and scheme members will have the opportunity to make submissions to the inquiry and raise any other concerns relevant to the scheme. DFWA has issued a Media Release on this matter.

The inquiry is on the agenda for the next Ex-Service Organisation Round Table, to be held on 2 April 2019.


The issues of DFRDB and Military Superannuation are problematic. There are several individuals who are actively researching and developing proposals that they see as being necessary to correct flaws and disadvantage (see below - PRIVATE MEMBERS LOBBYING).  These proposals and studies are very much a work in progress.

In the meantime, ADSO is placing before the Government, the Opposition and the cross bench the ADSO Policies and Objectives

Central to the, “Fair indexation and revision of military superannuation benefits and values” are the following:

  1. Fair Indexation for all Military Superannuation payments.
  2. MSBS Access to Employer Benefits.
  3. Defence Force Retirement & Death Benefits Scheme (DFRDB). Fair Indexation for all DFRDB recipients.
  4. DFRDB Commutation.
  5. Reversionary Benefits.


On 16 February 2017 Herb Ellerbock made a detail submission to expose a gross reduction and denial of recipient benefits in the Defence Force Retirement and Death Benefits (DFRDB) scheme.  See further information on this campaign under Current Issues / Indexation.


On behalf of the estimated 55,000 DFRDB superannuants that Commuted their benefits and the 1500 that registered in support of his campaign, DFWA member Ken Stone, has been conducting a focussed strategic campaign for the past four months, against the inequities of the Debt-Sentence, imposed by DFRDB on veterans. Like many others when they received their Lump Sum commutation they didn’t realise that they would be repaying it for the rest of their life. The outcome being, that their reimbursement of the amount received, has exceeded the commutation lump-sum amount they received, if they lived past the life expectancy age calculated on a dated table

The amount of the allowable Lump sum benefit was calculated by DFRDB on the individual veteran’s service data, including rank and time served, etc. Many understood that their fortnightly superannuation benefit would reduce as a result of this Lump Sum benefit having to be repaid to the DFRDB Fund. These repayment instalments were calculated using the individuals Notional Life Expectancy (NLE) factor – even then though, using actuarial tables that were some 12-years out of date and skewing the repayment rate detrimentally.

Understandably, many Veterans believed that on reaching their NLE point their debt would have been fully repaid, and, that their Superannuation benefits would be restored to full value. How wrong they were!  How could this misconception have occurred? Simply because the DFRDB Pamphlets given to new members and to those transferring from the old DFRB scheme, did not advise members the reduction in pension was for life. There was not full disclosure as is required by law for most superannuation schemes.

Some still serving DFRDB Members still contributing to the scheme were only advised of this 35 years after becoming a DFRDB member. Veterans who had already been discharged and receiving their superannuation, were never officially advised of the situation by DFRDB.

Ken Stone’s Campaign is simply and singularly targeted at correcting this Non-Disclosure by the DFRDB Authority, that has resulted in the financial penalty impost on veterans; a virtual DEBT SENTENCE, whole-of-life! The objective is to restore the veterans’ NLE point as the finalisation point for reimbursement payments to the DFRDB Authority, and to have all excess payments returned to veteran contributors affected by the Debt Sentence.

Ken issues regular updates on his very active campaign that is progressing positively. If you want to keep abreast of Ken’s campaign you can do so through our pages, that will carry future updates. If you wish to know how much your repayment instalments are, why not ring DFRDB on 1300 001 677 and ask?


Update 10 October 2017: Many veterans will be more than aware that among the taxation changes that came into effect on 1 July 2017, one particular one seemed to affect veterans receiving DFRDB/MSBS Invalidity Pensions.  That was because of the repeal of the 'Income Tax Assessment Regulations 1997 – Reg 995.1.03’.  The core issue appeared to be that ComSuper was incorrectly classifying an invalidity payment as a pension (and subsequently an income stream). This seems to be in direct contravention of the Superannuation Industry Supervision Regulations.

This incongruous issue was taken up by DFWA with the Minister for Veterans’ Affairs, who referred the matter directly to the Australian Tax Office (ATO). The ATO’s letter in reply can be accessed here.  We are not aware of any veteran who may have taken advantage of the so-to-speak loophole before the said 'Income Tax Assessment Regulations’ repealed. What the ATO suggests is that fewer than 400 veterans had used the loophole and only started doing so following the announcement that it would be shut down.

Update 10 July -   National President of DFWA David Jamison was interviewed on ABC Brisbane radio last Friday on the topical issue of tax and the way the ATO are treating veterans invalidity payments. Ray Martin in Townsville was separately interviewed as well. Both interviews are available in links hereunder and worth a listen:

(1) ABC Radio interview of David Jamison (DFWA) by Steve Austin.  This ABC Brisbane Radio 612 4QR’s Steve Austin interview of David Jamison (DFWA) today (Friday 7th July) continues on from yesterday’s program. Expectantly DVA Minister Dan Tehan calls in endeavoring to explain the matter. The upshot is that CSC must still explain the basis on which it has been (incorrectly) reporting invalidity super payments as pensions. CSC should provide detailed answers (with the legal basis explained) to the following:

  • Is an invalidity payment paid under either MSBS or DFRDB a pension in accordance with SUPERANNUATION INDUSTRY (SUPERVISION) REGULATIONS 1994 - REG 1.06 (1) (a) (i): and if so
  • Which standard of  SUPERANNUATION INDUSTRY (SUPERVISION) REGULATIONS 1994 – REG 1.06 sub regulation (9A) applies to the payment.

This is a must listen to radio broadcast.  Steve Austin’s introduction start at 15:35minutes.  David Jamison commences at 18:26 minutes to end at 29:39 minutes.  Dan Tehan commences at 37:16 minutes and ends at 47:01 minutes:

(2) ABC Radio Interview Of Col Ray Martin (Ret’d) By Steve Austin. This ABC Brisbane Radio 612 4QR’s Steve Austin interview of Col Ray Martin (Retd) (past CO 1 RAR) highlighted the issue. listen to radio broadcast here. Following the interview five callers affected by the Tax legislation explain the facts of the matter and the impact on their lives.

Update 4 July   DFWA has issued a short information sheet on this matter.

Update 3 July  The background to this issue was reported below. Channel 7 TV News last night (2nd July) reported that Veterans take on the Turnbull Government over changes to the way it taxes Comsuper Invalidity payments:


David Jamison, National President of the DFWA, stated that ‘Although it appears this change for veterans is an unintended consequence of a much broader taxation change, the veterans community as a whole considered it (if true) manifestly unfair. We all have the obligation to support our effected invalided veterans. We have asked the Government to ensure they will not be hit with higher taxes post 1 July 2017’. 

DFWA is continuing to consult with the DVA Minister Dan Tehan on the issue.

Update 27 June 2017: The Government’s REPEAL OF THE INCOME TAX ASSESSMENT REGULATIONS 1997 – REG 995.1.03, effective from 1st July 2017 will see many veterans in receipt of Invalidity Benefits paid from Military Superannuation set to lose many $100’s to over a $1000 a month. (NOTE - DVA Invalidity Payments are NOT caught in this change.)

This legislation allowed the compensatory nature of these benefits to be acknowledged and a lower rate of tax applied to these payments. This repeal removes that recognition and some Injured Ex ADF members will now lose large sums of money that actually allows them and their families to survive. For them this money means being able to pay their rent or mortgage, feed and clothe their children and have a reasonable (not extravagant) standard of living.

It is believed that neither of these payments meet the definition of a pension in Regulation 1.06 of the Superannuation Industry Supervision (SIS) Act, as required in the Tax Act. Comsuper refuses to answer the question on what basis are the Invalidity Benefits they administer (under DFRDB or MSBS), considered as a pension as defined in Regulation 1.06 of the SIS Regulations. Comsuper is bound to comply with the SIS Act to remain a complying superannuation fund. If veterans payments are treated in accordance with the relevant existing legislation, this looming crisis will be averted.

DFWA is making representations direct to the Government and the Parliament. 


Also ...consider joining the following Facebook Group for further information on this and other related matters: COMSUPER - MILITARY ENTITLEMENTS



The Fair and Sustainable Superannuation Act 2016

DFWA is seeking urgent advice to clarify some issues with the  Fair and Sustainable Superannuation Act 2016  and how the provisions are being applied to a typical unfunded untaxed DRFDB (Defined Benefits [DB]) superannuation. This superannuation income stream is fully taxed in the recipient’s hand, albeit with a 10% discount if the recipient is over 60 years of age. Yet the Commonwealth Superannuation Corporation (CSC) is including the gross amount in the calculations toward the $1.6m Transfer Balance Cap (TBC).  To any reasonable person, this seems blatantly unfair when compared to a person with a funded DB scheme; their gross and net are the same.

The intent of the Act is to impose a $1.6 million Cap on the amount of capital that can be transferred to the tax-free earnings retirement phase of superannuation – details of the Act are here.  http://www.aph.gov.au/Parliamentary_Business/Bills_Legislation/Bills_Search_Results/Result?bId=r5760

The impact of CSC’s decision is that:

  • If a person’s CSC calculated contribution to the TBC, and their accumulation funds in the retirement phase reaches $1.6M or more, with the CSC’s calculation the members TBC will remain as $1.6M. But the amount of capital available to generate tax free earnings in the retirement phase of superannuation will be reduced by the tax paid times 16, thereby leaving less than $1.6M of assets to generate tax free earnings. This certainly cannot be the intent of the Act.  For a retired long serving mid ranked officer paying $10k tax a year on his DFRDB pension this will reduce his capital by $160K and his tax free income in retirement by $8K ($160K x 5%, the accumulation fund in the pension phase draw down rate if over 65).
  • Potentially, with this inflated figure, if the recipient exceeds the $1.6M TBC, they will have to withdraw funds from the accumulation superannuation account in the retirement phase, as the funds attached to the DFRDB unfunded untaxed DB scheme are notional and cannot be accessed, thereby reducing the tax free retirement income by thousands of dollars.  This is not an insignificant reduction, rather a major hit to a veterans’ bottom line.
  • One of our DFWA Members has been corresponding with the CSC asking why the gross DFRDB pension was being used. CSC's response was "that was their understanding" of the requirements of the ATO and Department of Finance.  When CSC was asked for specific authorities and rules of the Act that lead to this “understanding”, CSC have been less than forthcoming.  CSC have also advised in an e-mail as late as 3 March 2017 that they are still liaising with regards to the changes and will provide updates as further information is confirmed. 

We request that Government determine the following and advise:

  • Why is a gross pension being used to calculate the amount that is to be in included in the Transfer Balance Cap, for an unfunded DFRDB figure?
  • Where is the authority for this action other than CSC’s “understanding”?
  • Why is an unfunded, therefore fully taxed, retirement stream from DFRDB even included in the TBC calculations, where Section 302-2 (1) (b) of the Act seems to indicate, "the sum of all of those benefits (other than elements untaxed in the fund benefits) exceeds... "
  • Why are funded and unfunded DB schemes treated the same under the Act?  The issue relates to the fact that in funded schemes the pension is received tax free, and for unfunded schemes the pension is fully taxed at marginal rates with the 10% discount for those over the age of 60.   Any calculations using gross figures will significantly disadvantage Members of unfunded schemes.
  • We also seek advice on behalf of the War Widows League and the Partners of Veterans Association as to how Reversionary Pensions, being received by a spouse/partner of a deceased Member who was part of a DFRDB scheme, will be treated.
  • Do the rules of the Act apply to all superannuants, as we have heard that pre 2004 Politicians and Judges’ schemes will not be affected by the Act?

The Act is to be implemented on 1 July 2017 and there are still many questions in regard to its application, therefore a prompt response has been requested to enable DFRDB superannuants to take action to adjust their superannuation if require