DHOAS Amendments
A number of amendments to the DHOAS Act have been in effect since 22 July 2009.
The Defence Legislation Amendment Bill (No. 1) 2009 and the amendments to the DHOAS Act 2008 addressed a number of unintended consequences of the Act that were not consistent with the original policy intent of the DHOAS.
The amended Act has been used to assess the eligibility and entitlement of all applicants for a new DHOAS Subsidy Certificate, since 22 July 2009.
The amendments do not affect you if you have already held a Subsidy Certificate or you're already in receipt of subsidy payments.
However, if your current DHOAS Subsidy Certificate expires or you cease your current subsidy assistance and you apply for another Subsidy Certificate to restart your payments, your eligibility and entitlement will be determined in accordance with the amended Act.
If you believe a reassessment under the amended Act may affect your DHOAS eligibility, and impact on your current DHOAS subsidy payments, you are advised to contact DHOAS to discuss your plans before making any major changes to your existing DHOAS home loan and subsidy payments.
Rejoining Members
Prior to the amendments, members who had an extended break in Defence service and then rejoined the ADF prior to 1 July 2008 were not subject to the rejoining provisions in the DHOAS Act, whereas members who rejoined on or after 1 July 2008 were.
Depending on the length of a member's break, and whether you reenlist as a Permanent member or as a Reservist, the rejoining provisions determine whether your pre-break years of service will count towards your DHOAS eligibility and entitlement.
The provisions can have a significant impact on whether you are determined eligible to receive DHOAS, and on your tier level and length of entitlement period.
The amendments ensure the rejoining provisions apply equitably to all rejoining members, regardless of the date you rejoin.
For full details about the rejoining provisions, see Rejoining the ADF After a Break.
Lump Sum Option
Amendments were made around eligibility for the DHOAS lump sum, which have been in effect since 22 July 2008. They do not affect you if you've already been paid your lump sum.
Prior to the amendments, members who purchased a residential property for investment purposes whilst in the ADF were able to receive the DHOAS lump sum, whereas members who purchased and occupied a home could not.
The amendments have addressed this discrepency so that any member who has previously purchased a residential property whilst in the ADF, whether or not they lived in the home, is unable to access the lump sum.
This reflects the intent of the lump sum to assist members who are buying a home for the first time whilst they've been serving in the ADF.
The lump sum is not paid on a residential property bought before a person is given the Subsidy Certificate that is the basis for the lump sum request. This prevents a person getting the lump sum where they have only owned the one property, but bought it some time previously.
Further, the amendments ensure that members who access the lump sum must retain sufficient service credit to support on-going monthly DHOAS subsidy payments.
Previously, a lump sum could have been accessed in isolation by a serving member, rejoining member or rejoining incapacitated member. This was because members who were eligible on these grounds could use all their credit on a lump sum then cease to be eligible for ongoing subsidy payments until they accrued a further Service Credit.
Please see Lump Sum for further details about receiving the lump sum payment.
Joint Home Loans
Amendments to the joint home loan arrangements have applied to any subsidy payments made from 22 July 2009.
The amendments clarify and simplify the administration of subsidy for partners who jointly take out a subsidised loan.
They also ensure that the entitlement for the subsidised borrower who has purchased a home with a person who is not their partner is in proportion to the member's liability for the loan.
For further details about how joint home loans are now administered for the purpose of DHOAS, please visit: Multi-Party Loans.
Criteria for Issue of Subsidy Certificate
A Subsidy Certificate is issued to an applicant so that it may be presented to a DHOAS home loan provider as evidence of the member's entitlement to payment of a DHOAS subsidy.
Previously, a Subsidy Certificate could have been issued even if the member had exhausted their Service Credit and could not receive a subsidy payment. This undermined the reliability of the certificate as evidence for home loan providers that a member was able to receive a subsidy on the loan provided.
The amendments ensure that an applicant only receives a Subsidy Certificate if they have a Service Credit.
A Subsidy Certificate will also cease to be in force if the holder of the Certificate is not a member of the ADF and stops having a Service Credit.
This will take effect from 22 July 2009.
Delegation to Give Notice of Reviewable Decisions
Previously, authority could not be delegated to an authorised Commonwealth contractor (in this case, DVA) to exercise the power to notify applicants of the reasons for a first-instance decision that is amenable to internal review. This added time and complexity to the process.
Under the amendments, the Scheme Administrator (DVA) has the delegated power of the Secretary's function to provide written statements of reason for a decision that may be reviewable, including information about the affected person's rights.