The Chairman of the Repatriation Commission has forwarded for advice the following memorandum:

Section 43 of the Australian Soldiers' Repatriation Act 1920 reads as follows: Subject to this Act, a pension shall be absolutely inalienable whether by way or in consequence of sale, assignment, charge, execution, insolvency, or otherwise howsoever.

Notwithstanding the above section of the Act the Department in certain instances has at the request or with the consent of the pensioner, obtained an assignment in its favour of war pension in cases-

1. where an overpayment of pension has been made;
2. where overpayment of living allowance has been made;
3. in liquidation of loans granted by the Department and
4. in the case of industrial trainees where pension is taken into account in computation of the wages payable.

For your information I enclose herewith copies of memoranda by officers of this Department which explain the manner in which pensions have been assigned in favour of the Department.

In August last the Department directed that the practice of enforcing deductions from war pensions because of overpayment of living allowance or sustenance should cease, but the practice of accepting assignments of pensions from vocational trainees under the industrial training scheme as well as voluntary assignments to the Department as a means of liquidating liabilities or overpayments continues to operate.

In October last the memoranda accompanying this communication were placed before one of your officers, and after discussion the opinion was expressed that whilst it is not permissible to assign or transfer a pension, there is nothing in the Act to prevent a pensioner entering into an agreement with the Department to the effect that in consideration of the Department providing the soldier with training and supplementing his wages for a certain period, he relinquishes his right to his personal pension for the period mentioned, and undertakes not to draw same at any time.

The provisions of section 43 were inserted originally to protect war pensioners from unscrupulous individuals and firms which might not hesitate to take advantage of a pensioner's necessity. There was at that time no provision for general repatriation benefits to which a pensioner might be entitled, and the question as to assignment of pension as a set-off against overpayment in regard to a repatriation benefit had not arisen. This is mentioned merely to indicate that there could not have been any intention that the section should operate against this Department with respect to repatriation benefits.

If it is considered that such an agreement is not an assignment, but simply serves to absolve the Commonwealth Government from its liability to pay a pension to the soldier in respect of his disability for a certain period, it is desired that a suitably framed agreement on the lines indicated be prepared by you or the Crown Solicitor. It is also desired that the agreement should include cases in which overpayments of pensions or living allowances have been made, and also where the soldier desires to have his pension applied in the liquidation of loans granted to him by the Department.

Section 23 of the Australian Soldiers' Repatriation Act 1920-1921 provides that under certain circumstances (mentioned in the section) the Commonwealth shall, subject to the Act, be liable to pay to a member of the Forces or his dependants, or both, as the case may be, pensions in accordance with the Act.

A pensioner is not, however, in my opinion, compelled to receive payment of his pension and may, I think, release the Commonwealth from its liability to pay the pension. Any such release in order to be enforceable would of course have to be either under seal or for valuable consideration.

In the case of overpayment of pension or living allowance the person to whom the overpayment has been made is not, however, I think under any liability to the Commonwealth to refund the amount overpaid and any release not under seal would not be effective to prevent that person subsequently claiming the pension retained by the Commonwealth. All releases in such cases should, therefore, be under seal.

As regards the liquidation of loans granted by the Department, the repayment of those loans is secured by mortgages or personal securities given in accordance with the provisions of the Australian Soldiers' Repatriation Regulations 1920 relating to securities. Under those securities the Commission has power to recover in various ways the amount lent and forbearance by the Commission to sue would, I think, be good consideration for the pensioner's foregoing his right to his pension or portion thereof for a certain period.

The position with regard to an industrial trainee who receives an allowance to supplement his wages whilst in training is, I understand, that the employer agrees to pay the trainee a rate of wage proportionate to the wage fixed by a wages board or industrial tribunal as the assessed efficiency of the trainee is proportionate to full efficiency, and the Commission grants to the trainee an allowance which with his pension brings his rate of wages up to the prescribed rate. Under the wages board determinations or awards, however, the employer is required to pay the trainee the prescribed rate and the Commission, therefore, instead of paying the amounts of allowance and pension to the trainee pays to the employee a sum equal to the aggregate of those amounts, thus reimbursing the employer the amount which he has paid in excess of that agreed on. The present practice is that the pensioner nominally assigns his pension to the Department. Whilst I am doubtful whether such a practice is an assignment contemplated by section 43, in view of the fact that the trainee actually receives per medium of the employer the full amount payable to him by way of pension and in accordance with the regulations and rulings relating to vocational training (regulations 86 and 87 and Ruling No. 75), the better course would, I think, be for the trainee to forego his right to pension during the training period in consideration of his being granted assistance under the vocational training scheme.

As regards Ruling 75, however, it is, I think, inconsistent with regulation 87 and any trainee granted assistance under regulation 87 should, I think, be paid his pension in addition. It appears to be desirable, therefore, that regulation 87 should be modified as regards improvers.

Where the trainee is a minor, consideration might have to be given to the question how far he would be bound in law by a release given by him.

Draft forms of release to meet the various cases are being prepared by the Crown Solicitor and will be forwarded in due course.

I may add that in view of the fact that assistance is granted under the Act and Regulations by the Commission or a Deputy Commissioner and the release is granted to the Commonwealth, it would, I think, in every case be advisable for the release to be under seal.

[Vol. 18, p. 324]