Major inquiry says Veterans' Affairs Department should be abolished
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Major inquiry says Veterans' Affairs Department should be abolished

The Morrison government has been told Australia’s $13 billion-a-year system for supporting military veterans is broken and should face overhaul, including abolition of the mammoth Department of Veterans' Affairs.

Calling for "bold" reform to avoid further failure, a new report by the Productivity Commission has found the veterans affairs system should operate more like a modern worker's compensation scheme, with Defence taking more responsibility for ex-service men and women's lifetime care, including better preparing them for post-military life.

Commissioner Robert Fitzgerald said there had been a litany of reviews in recent years but none had produced enough change to make the system fit to meet veterans’ needs.

"The time for tinkering is over, and bold reform is needed," Mr Fitzgerald said. “It’s not that there hasn’t been progress, it’s just not sufficient to get us where we need to be.

"The commission is absolutely clear that unless there are bold reforms … it will not be a system that is able to meet the needs of future veterans."

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The report states that the present system is out-of-date and not working in the interests of veterans and their families, or the Australian community.

It is complex, difficult to navigate, inequitable and poorly administered, which "places unwarranted stress on claimants" who are often vulnerable in the first place.

A major review has found the system supporting Australia's veterans needs to be overhauled.

A major review has found the system supporting Australia's veterans needs to be overhauled. Credit:Alex Ellinghausen

While the existing scheme paid out $13.2 billion last financial year - an average of $47,000 each for Australia's 166,000 veterans and 117,000 dependants being supported - "money alone does not mean it is an effective scheme".

The report, which was prompted by a Senate inquiry into veteran suicide, states the system needs to focus more on the well-being of veterans over their lifetimes. That means more focus on prevention, rehabilitation and transition support.

The Department of Veterans’ Affairs would be abolished. Responsibility for veterans policy would go to a senior unit within Defence, while a new statutory agency, the Veteran Services Commission, would take charge of administering support.

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The agency would process claims, rehabilitate injured and ill veterans, and pay appropriate compensation for pain, suffering and lost income. It would also pay for and find health and community services for veterans.

Defence would put money into a fund that would pay for rehabilitation and compensation for veterans. This means they would have a greater incentive to prevent injury and illnesses to serving personnel.

This fund would then have to be managed sustainably by the new agency, which would have an incentive to “focus on the lifetime costs of supporting clients”, intervening early and finding cost-effective rehabilitation.

Richard Spencer, another commissioner who worked on the report, said the average veteran today was different from one in the past. Military personnel serve an average of eight or nine years and often leave in their mid-to-late 20s.

"The rest of their life is ahead of them," he said.

They needed less aged care and pension-style support and more timely rehabilitation and help getting into civilian employment quickly and effectively.

Mr Spencer said a particular danger period was the transition to civilian life, especially for younger veterans.

"One of the disconnects that’s happening in the transition is that when veterans discharge they immediately shift to [the Department of Veterans Affairs]. They don’t have continuity of care. Programs can stop and restart. That’s when things can go dramatically wrong,” he said.

A joint command within Defence would be responsible for veterans’ welfare for about six months after they leave the military under the Productivity Commission’s proposals.

David Wroe is defence and national security correspondent for The Sydney Morning Herald and The Age.

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