How Will Your DRCA Permanent Impairment Compensation Change Under the Vets Act?

If you currently have accepted conditions under the Safety Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) but don’t qualify for Permanent Impairment (PI) payments, the upcoming legislative changes the Vets Act could make a significant difference to your compensation.

Current vs. Proposed Assessment: A Real Example

Consider Mary’s situation:

• Current assessment under DRCA:
  • Mary (55) has accepted service-related conditions for her ankle and tinnitus
  • Each condition is assessed individually
  • Neither condition meets the required 10% threshold for payment
  • Result: No permanent impairment payment
• Under new legislation (MRCA):
  • Mary’s conditions are assessed using a whole-of-person approach
  • Her combined impairment rating is 19 points
  • Result: Mary qualifies for either $96.42 per fortnight OR a lump sum of $49,608.09

Key Differences in Assessment Methods

The dramatic improvement in Mary’s case comes from a fundamental difference in how permanent impairment is evaluated:

1. DRCA (Current):
   • Each condition is assessed separately
   • Impairment ratings from different conditions are not combined
   • Must meet a minimum 10% threshold per individual condition
2. MRCA (Proposed):
   • Uses a whole-of-person impairment assessment
   • Combines impairments from all service-related conditions
   • Lower threshold when conditions are combined

What This Means For You

If you have multiple service-related conditions that individually fall below the 10% DRCA threshold, you may soon qualify for compensation that was previously unavailable to you.

The VETS Act closes the Veterans’ Entitlements Act 1986 (VEA) and Safety Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) to new claims from 1 July 2026. From this date, all compensation and rehabilitation claims will be determined under a single ongoing Act – the improved Military Rehabilitation and Compensation Act 2004 (MRCA). The MRCA recognises that multiple “minor” conditions can collectively have a significant impact on quality of life and earning capacity.

Next Steps

For personalised information about how these changes might affect your specific circumstances, contact KSC Claims for guidance.