Defence Determination 2017/18, Overseas conditions of service (Budget measure 2017-18 – Overseas allowances) amendment
I, LISA ANNETTE ARNOLD, Acting Assistant Secretary People Policy and Employment Conditions, make this Determination under section 58B of the Defence Act 1903.Dated 8 June 2017
L A ARNOLD
Acting Assistant Secretary
People Policy and Employment Conditions
Defence People Group
PAGE INTENTIONALLY LEFT BLANK
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/Name
1. / This Determination is Defence Determination 2017/18, Overseas conditions of service (Budgetmeasure 2017-18 – Overseas allowances) amendment.2. / This Determination may also be cited as Defence Determination 2017/18.
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/Commencement
1. / Each provision of this instrument specified in column 1 of the table commences, or is taken to have commenced, in accordance with column 2 of the table. Any other statement in column 2 has effect according to its terms.Commencement information /
Column 1 / Column 2 / Column 3 /
Provisions / Commencement / Date/Details /
1. The whole of this instrument / 1 July 2017
Note: This table relates only to the provisions of this instrument as originally made. It will not be amended to deal with any later amendments of this instrument.
2. / Any information in column 3 of the table is not part of this instrument. Information may be inserted in this column, or information in it may be edited, in any published version of this instrument.
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/Authority
This instrument is made under section 58B of the Defence Act 1903.4
/Schedules
Each instrument that is specified in a Schedule to this instrument is amended or repealed as set out in the applicable items in the Schedule concerned, and any other item in a Schedule to this instrument has effect according to its terms.2
Schedule1—Chapter 12 amendments
Defence Determination 2016/19, Conditions of service
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/Section 12.3.9 (Long-term posting overseas)
After the section, insert:12.3.9AMember posted before 1 July 2017
1. / Means a member for whom any of the following conditions apply.a. / The member commenced a long-term posting overseas before 1July2017 and continued that posting on or after 1July 2017.
b. / There is evidence that the member's Service made a decision before 1July2017 to post the member on a long-term posting overseas.
Examples: A posting order, warning order, List of Officers Postings, List of Sailors Postings, demi-official letter, posting schedule.
c. / The member began a training course before 1July2017 to specifically meet the requirements of a long-term posting overseas.
d. / The member applied in writing for an expression of interest for a long-term posting overseas, issued before 1July2017.
2. / Despite subsection 1, Assistant Secretary People Policy and Employment Conditions may decide that a member is a member posted before 1 July 2017.
Note: This section does not apply to any members on a long-term posting overseas on or after 1 July 2020.
See: Section 12.3.9B, Member posted on or after 1 July 2017
12.3.9BMember posted on or after 1 July 2017
Means one of the following.a. / For the period of 1 July 2017 to 30 June 2020 — a member who is not a member posted before 1July 2017.
See: Section 12.3.9A, Member posted before 1 July 2017
b. / For the period beginning on 1 July 2020 — all members on a long-term posting overseas.
Schedule2—Chapter 14 amendments
Defence Determination 2016/19, Conditions of service
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/Section 14.2.10 (Financial advice before leaving Australia), heading
At the end of the heading, insert " – member posted before 1 July 2017"2
/Section 14.2.10 (Financial advice before leaving Australia – member posted before 1 July 2017)
Before subsection 1, insert:1A. / This section only applies to a member posted before 1 July 2017.
See: Chapter 12 Part 3 section 12.3.9A for the definition of Member posted before 1July2017
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/Paragraph 14.2.11.3.d (Reimbursement of costs if long-term posting cancelled)
Omit the paragraph, substitute:d. / Reimbursement for loss on sale of a vehicle for a member posted before 1July2017.
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/Section 14.3.14 (Loss on sale of private vehicle), heading
At the end of the heading, insert " – member posted before 1 July 2017".5
/Subsection 14.3.14.1 (Loss on sale of private vehicle)
Omit "A member posted overseas may be reimbursed the amount of a loss incurred on the sale of a private vehicle.", substitute "A member posted before 1 July 2017 to a posting location overseas may be reimbursed the amount of a loss incurred on the sale of a private vehicle."6
/Subsection 14.6.8.3 (Conditions of service during evacuation)
Omit the subsection, substitute:3. / The Commonwealth will continue to pay utilities costs.
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Schedule3
Part 1—Chapter 15 Part 2A
Defence Determination 2016/19, Conditions of service
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/Chapter 15 Part 2 (Overseas living allowances – member posted before1July2017)
After the Part, insert:Part 2A: Overseas living allowances – member posted onorafter1July2017
15.2A.1Overview
This Part sets out provisions for the overseas living allowances.15.2A.2Contents
This Part includes these Divisions and Annex.Division 1 / Purpose, application and key concepts – member posted onorafter1July2017
Division 2 / Cost of living adjustment – member posted onorafter1July2017
Division 3 / Cost of posting allowance – member posted onorafter1July2017
Division 4 / Child supplement allowance – member posted onorafter1July2017
Annex 15.2A.A / Post indexes – member posted onorafter1July2017
Division 1: Purpose, application and key concepts – member posted on or after 1July2017
15.2A.3Purpose
1. / The purposes of overseas living allowances are as follows.a. / To help maintain the purchasing power of a member's income, and an equivalent standard of living.
b. / To help the member meet unexpected living costs associated with a long-term posting overseas.
c. / To help the member meet some additional costs at the overseas posting location.
Examples: Communications, holidays, vehicle depreciation, winter clothing.
d. / To partially compensate for loss of the member's spouse or partner's income.
2. / The allowances are not meant to do either of the following.
a. / Increase a member's income.
b. / Make up for loss of income earned by a member's spouse or partner.
c. / Attract members into service overseas.
3. / The allowances are notional. This means that it is based on what a member would be expected to spend, rather than on their actual expenditure.
15.2A.4Member this Part applies to
This Part applies to a member posted on or after 1July2017.Note: For definition of Member posted on or after 1July2017, see Chapter 12 Part 3 section 12.3.9B.
15.2A.5Member this Part does not apply to
1. / This Part does not apply to a member who is away from their posting location.See also: Part 1 section 15.1.3, Member this Chapter does not apply to. Section 15.1.3 outlines other situations in which members are not eligible for overseas living allowances or other long-term posting conditions.
15.2A.6Changes in overseas living allowances
1. / Overseas living allowances are subject to constant change. These changes are the result of a number of factors, including the following.a. / Periodic price reviews.
b. / Measured changes in exchange rates.
c. / Any changes to an individual's salary.
d. / Any changes to an individual's family circumstances.
2. / The changes to the allowances can be large, and can occur with little or no warning. The allowances might go up or down.
15.2A.7Post index
1. / A post index shows the relative cost of living at a posting location, compared with Australia.Example: A country has a post index of 125.00. The country's cost of living is assessed as 25% higher than Australia's.
2. / Post indexes are listed in the applied index column of Annex 15.2A.A. The index that applies is the one listed for the member’s posting location. If an actual index is not listed for a posting location within a country, the 'Other' index listed for the country must be applied to the member's posting location overseas.
3. / The post index is worked out each year from a survey of local prices and exchange rates carried out by a data service provider. The list of post indexes may later be varied as a result of one of these changes.
a. / Creation of a new posting location.
b. / Exchange rate movements (see subsection 4).
c. / A special analysis of costs at the posting location.
Note: A post might ask for a special analysis because of a specific change in circumstances.
4. / Before a determination is made to vary a post index, the following processes are followed.
a. / The administrator checks that both the following conditions apply.
i. / There have been at least two pay periods since the post index was last varied.
ii. / There has been an exchange rate movement (up or down) of 2% or more since the post index was last varied.
b. / The following table shows the steps used by the administrator to recommend that a post index should be varied.
Step / Action
1. / Obtain the recent exchange rate for the posting location from the data service provider.
2. / Obtain the previous varied exchange rate. This is the rate that was current the last time the post index was varied.
3. / Calculate the variation (%) between the recent and previous varied exchange rates described in steps 1 and 2. This is done using the following formula.
exchange rate variation (%) / = / recent exchange rate – previous varied exchange rate / x 100
previous varied exchange rate
4. / Determine whether the post index will vary.
a. / If the variation is less than 2% (up or down) recommend not to vary the post index.
b. / If the variation is 2% or more (up or down) recommend to vary the post index.
Note 1: Local exchange rates for each posting location are monitored regularly.
Note 2: Exchange rates are supplied by a data service provider engaged by the Department of Defence.
Note 3: The data comparison and calculation is done by the Directorate of Military Conditions and Housing Policy.
5. / The new post index will take effect as soon as practicable after the variation is worked out. When a variation is applied, the exchange rate that led to the change will become the new base for working out future variations.
6. / Column 3 of Annex 15.2A.A shows the index published for the posting location by the data service provider. This index is not used in working out the overseas living allowances, because the post index used for this purpose must not be less than 100.
15.2A.8Effect of non-Commonwealth allowances on the overseas living allowances
1. / This section applies if a member receives a benefit from another entity for a similar or comparable purpose to that of a benefit provided by this Part.2. / The comparable benefit paid under this Part is reduced by the amount of the benefit received.
15.2A.9The dual Commonwealth benefit rule
1. / This section applies to a member if both of the following apply to their spouse or partner.a. / They are posted to the same location as the member.
b. / They are eligible for a benefit from the Commonwealth that is for the same or comparable purpose to those provided under this Part.
2. / This section only applies to the member if a benefit under this Part provides that it applies.
3. / The member ceases to be eligible for the benefit in the following circumstances.
a / Their spouse or partner is also a member or a Defence employee and the following conditions apply.
i. / The spouse or partner has a higher salary than the member.
ii. / The member has nominated the spouse or partner to receive the benefit.
b. / Their spouse or partner is not a member or a Defence employee and the member has not advised that the spouse or partner is not receiving the same or comparable benefit.
Example: A member is posted to Jakarta. The member's spouse is an APS employee in the Department of Foreign Affairs and Trade, and is on a long-term posting to Jakarta for the same period as the member. The member is eligible for the overseas living allowances. The member's spouse is paid allowances for living overseas by the Department of Foreign Affairs and Trade. The member is not eligible for the benefit.
Division 2: Cost of living adjustment – member posted on or after 1July2017
15.2A.10Purpose
Cost of living adjustment is an allowance provided to a member at a posting location where goods and services are more expensive than in Australia. It has both the following purposes.a. / To help maintain the purchasing power of a member's income.
b. / To provide the member with an equivalent standard of living at the overseas post to that in Australia.
15.2A.11Period of eligibility
The member is eligible for a cost of living adjustment for the duration of the posting period overseas.15.2A.12How the cost of living adjustment is worked out and applied
1. / The cost of living adjustment is paid to a member in each fortnightly pay.Exception: If the member's post index is 100 or less the member does not receive a cost of living adjustment.
2. / The cost of living adjustment is worked out using the steps in the following table.
Step / Action
1. / Subtract B from A, where:
A / = / The member's gross salary. The only allowance that may be included in this figure is higher duties allowance if the member is receiving that allowance.
B / = / Pay As You Go tax and any levies withheld from the member's salary.
Examples: Medicare Levy, temporary budget repair levy, flood levy.
2. / Apply to the result of Step 1 the spendable salary factor determined by a data service provider.
Note: The factor works out the spendable part of a member's salary for day-to-day living expenses.
3. / Multiply the result of Step 2 by the following formula using the applied post index for the member's posting location.
(applied post index -100)
100
Note: The dual Commonwealth benefit rule does not apply to the cost of living adjustment. A member will receive this adjustment even if their spouse or partner also receives the adjustment or comparable benefit.
Division 3: Cost of posting allowance – member posted on or after 1July2017
15.2A.13Purpose