5When a person is a member of the Reserves

#### 5 When a person is a member of the Reserves Membership of the Reserves (1) For the purposes of this Act, a person who has been engaged (by enlistment, appointment or transfer) as a member of the Reserves at a particular time (the engagement time) is to be treated as a member of the Reserves until: (a) the engagement ends; or (b) during a service year: (i) the engagement does not end; but (ii) the person does not perform effective service as a member of the Reserves. Effect of failure to perform effective service (2) If a person’s membership of the Reserves ends under paragraph (1)(b) in relation to a service year, this Act applies to the person, and is taken to have applied to the person, as if he or she had: (a) in the case of a person who was a member of the Reserves at the end of the previous service year—stopped being a member of the Reserves immediately after the end of the previous service year; or (b) in any other case—not been engaged as a member of the Reserves at the engagement time. > Note: This section may have the following effects: (a) the time at which a person is taken to stop being a member of the Reserves (or of the Defence Force) may be affected; (b) there may be a retrospective loss of entitlements in relation to subsidy certificates, the payment of subsidy, service credits and accrued subsidy periods and loan limits; (c) in particular, an authorisation of the payment of subsidy on the basis of a person’s membership of the Reserves may be revoked retrospectively (see section 44); (d) if a subsidised borrower who is taken not to have been a member of the Reserves because of the operation of subsection (2) would have been otherwise entitled to subsidy, the authorisation of the payment of subsidy to the person may be varied retrospectively (see section 45). > Note: Example: A person is engaged as a member of the Reserves. The person is given a subsidy certificate under Part 3 on the basis of eligibility as a serving member of the Reserves. The person starts to receive amounts of monthly subsidy accordingly. > Note: However, at the end of the service year, the person has not performed effective service as a member of the Reserves. > Note: Because of subsection (2), this Act applies as if the person was not entitled to be given the subsidy certificate (because he or she was not eligible as a member of the Reserves). > Note: As a result, the original authorisation of the payment of subsidy may be revoked or varied (see sections 44 and 45). Amounts of subsidy to which the person is not entitled (because of the revocation or variation) are recoverable as overpayments under Division 6 of Part 4.