National Disability Insurance Scheme (Supports for Participants—Accounting for Compensation) Rules 2013

The core legal concept is the “compensation reduction amount”. The Rules make compensation for personal injury a financial offset against NDIS funding for supports that would otherwise be provided by the Scheme. Compensation reduction amounts are the mechanism by which the NDIS avoids funding supports that have already been, or should be, funded from compensation (paragraphs 1.1-1.3 and 3.5). The Rules distinguish four factual and legal scenarios for computing that amount (paragraph 3.1):

• Judgement or settlement where the “NDIS component” is objectively identifiable (paragraph 3.1(a); computed under paragraph 3.11). The NDIS component is the portion of the award referable to supports that could be funded under the NDIS after the judgment/settlement date (paragraph 4.4). The calculation in this scenario begins with identifying that component, subtracting any amounts the participant already spent on supports of that kind after the judgment/settlement and prior to becoming a participant, and subtracting any previous reductions (paragraph 3.11).

• Judgement or settlement where an NDIS component is not objectively identifiable but compensation was fixed (paragraph 3.1(b); computed under paragraph 3.13). The CEO starts from the amount fixed by the judgment/settlement and applies a sequence of subtractions and adjustments: statutory offsets (Health and Other Services (Compensation) Act 1995; Health and Other Services (Compensation) Care Charges Act 1995; Part 3.14 of the Social Security Act 1991; and any law prescribed by NDIS rules), value for statutory preclusion periods (3.13(c)), a 50% reduction where lost-earnings damages were claimed but no preclusion period applies (3.13(d)), an upper bound replacing the amount with the present value of supports the NDIS would have funded over the participant’s expected lifetime where the former is larger (3.13(e)), reductions for amounts already spent on supports after the compensable event and before NDIS participation (3.13(f)), and deductions for recoverable amounts or Agency deductions under specified Act provisions (3.13(g)-(h)). The calculations are subject to actuarial modelling published by the Agency where required (3.14).

• Statutory insurance or compensation schemes (paragraph 3.1(c); computed under paragraphs 3.17-3.18). The compensation reduction amount is the total value of care and support expected to be provided under the statutory scheme until the participant’s plan is next required to be reviewed, calculated in accordance with an actuarial model published by the Agency and in consultation with the scheme administrator (3.17-3.18).

• Agreements to give up compensation (paragraph 3.1(d); computed under paragraph 3.19). The CEO is to assess what the NDIS component would likely have been under a non-consent judgment, subtract prior plan reductions and amounts the participant already paid for relevant supports after the injury and before NDIS participation (3.19). If a person entered into such an agreement, the CEO must first be satisfied that entering into it was not reasonable in the circumstances, and the CEO’s assessment must take into account a list of factors, notably the disability’s effect on the ability to assess the agreement, and the person’s reasons and impacts (3.2).

Valuation and time horizon concepts: periodic components of awards are to be valued in accordance with actuarial standards, in consultation with the scheme actuary, where amounts are not specified (3.3). Lump-sum reductions may be amortised over no longer than the remainder of the participant’s expected lifetime in accordance with accepted actuarial standards (3.7). The Agency is required to publish actuarial models where calculations refer to them (3.14, 3.18(a)).

Discretion and exception are central. The CEO has an express power to ignore all or part of a compensation reduction amount in special circumstances, which may include financial hardship (3.10). The CEO may also give non-liable advice about likely reductions to someone contemplating settlement (3.8-3.9).

Definitions and non-operational text: the Rules signal that some boxed explanatory text is non-operative (4.2). Terms from the Act retain their Act meanings unless a contrary intention is shown (4.3), and the Rules reproduce key Act definitions for convenience (4.4).

Primary subjects: participants, prospective participants and the CEO (Agency). The Rules operate when a person is a participant or later becomes one and the person’s impairment is at least partly caused by personal injury (paragraph 3.1). Practically, affected people include:

• Participants who have received compensation by judgement or settlement (objective NDIS components or otherwise) (paragraphs 3.1(a)-(b), 3.11-3.13). Such participants will face reductions in NDIS funding for supports to the extent calculated as the compensation reduction amount (paragraph 3.5).

• Participants receiving statutory compensation or insurance payments under Commonwealth, State or Territory schemes (paragraph 3.1(c), 3.17-3.18). The expected value of care/support under those schemes until the next plan review is to be treated as a reduction to NDIS funding.

• People who entered into agreements to give up compensation (paragraph 3.1(d)). The CEO may treat foregone compensation as a compensation reduction amount, subject to a reasonableness gate: the CEO must not apply that treatment if satisfied the person’s decision to give up compensation was reasonable; if not satisfied, the CEO will apply the assessment in paragraph 3.19 and must consider specified factors when determining reasonableness (paragraph 3.2).

Administrative actors and professionals: the CEO and the Agency, who decide and implement reductions (paragraphs 3.4-3.5). The Rules require the CEO to consult the scheme actuary when valuing periodic payments (3.3), and to consult administrators of statutory compensation schemes when calculating expected care and support under those schemes (3.18). The Agency is also responsible for publishing actuarial models used in certain calculations (3.14, 3.18(a)).

Counterparties: insurers, defendants, and the administrators of statutory compensation schemes. Their judgments, settlements, statutory entitlements and contracts feed into the CEO’s calculations (3.1, 3.13, 3.17-3.18). Legal practitioners advising claimants will be affected by the CEO’s ability to provide non‑binding advice on likely reduction amounts (3.8-3.9).

Family and carers: mentioned in the Rules’ references to the Act’s principles (Part 1), family and carers may be affected indirectly through plan revisions and funding changes, and as relevant evidence for the CEO’s reasonableness assessment under paragraph 3.2.

Who pays: funding reductions are made to the NDIS plan by the CEO, reflecting that the NDIS will reduce its funding commitment to the degree the CEO identifies compensation as meeting the support need (paragraphs 3.5, 3.11-3.19). The Rules also anticipate recoveries and offsets under sections of the Act (3.13(g)-(h) referencing sections 105B, 106 and 107 of the Act), indicating financial interactions between compensation monies, recovery obligations, and NDIS funding.

Secondary effects: actuaries and experts who value periodic payments and lifetime support costs, and plan managers who must reflect compensation offsets in statements of participant supports, will incur administrative and professional inputs under these Rules.

Duties imposed on the CEO

• Take compensation into account when approving statements of participant supports by reducing NDIS funding by an appropriate compensation reduction amount (paragraph 3.5). That duty triggers both for first plans and for revised plans (paragraph 3.5).

• Revise a participant’s plan if the person is already a participant and a relevant compensation matter arises (paragraph 3.4).

• Identify the appropriate compensation reduction amount according to the applicable pathway,objectively identified NDIS component (3.11), other judgements/settlements (3.13), statutory schemes (3.17-3.18), or agreements to give up compensation (3.19).

• Where periodic payments are part of the compensation but not specified in judgment, the CEO must use accepted actuarial standards in consultation with the scheme actuary to assess their value (paragraph 3.3).

• Ensure actuarial calculations that the Rules require are done in accordance with any applicable actuarial model published by the Agency on its website (paragraphs 3.14, 3.18(a)).

• Consult the administrator of a statutory scheme when identifying the total care and support expected under that scheme (paragraph 3.18(b)).

• Consider specified factors in deciding whether it was reasonable for a person to have given up a right to compensation before applying paragraph 3.19 (paragraph 3.2).

Discretionary powers and exceptions for the CEO

• The CEO may ignore whole or part of a compensation reduction amount in special circumstances (paragraph 3.10). The Rules explicitly note that special circumstances may include financial hardship.

• The CEO may amortise a reduction over no longer than the participant’s remaining expected lifetime, following accepted actuarial standards and consultation with the scheme actuary (3.7).

• The CEO may provide advice to a person contemplating settlement about likely compensation reduction amounts, but that advice attracts no liability (3.8-3.9). This is a policy instrument to influence private settlement behaviour without creating legal exposure for the Agency.

Participant and prospective participant rights and obligations

• Participants must be treated consistently with the Act’s objects and principles in relation to compensation treatment; the CEO must have regard to those objects and principles when exercising discretion such as assessing reasonableness or special circumstances (Part 1 and paragraph 3.2).

• Participants have a procedural right to have their plan revised when compensation issues arise (3.4).

• Where a participant has already used compensation funds to pay for supports after a judgement/settlement or compensable event, those amounts must be subtracted from the compensation reduction amount calculation (paragraphs 3.11(b), 3.13(f), 3.19(c)). This creates an incentive to retain records and provide evidence of such expenditures.

• A participant who gave up a right to compensation could have an assessed reduction applied to their NDIS funding, unless the CEO is satisfied it was reasonable to give up the claim (3.1(d), 3.2, 3.19). The participant therefore has a procedural opportunity to persuade the CEO that the agreement was reasonable, by providing evidence for the enumerated matters in paragraph 3.2.

Other interactions and procedural entitlements

• The Rules require actuarial models to be published by the Agency where applicable (3.14, 3.18(a)), providing a transparency right for participants and advisers to the methodology used for lifetime/periodic valuations.

• Administrators of statutory compensation schemes are to be consulted in calculations for statutory scheme cases, which creates an administrative duty for the CEO to engage relevant external entities (3.18(b)).

• The CEO is to ensure that deductions applied do not exceed the value of supports the CEO considers would have been provided and funded by the Scheme across the participant’s expected lifetime in certain scenarios (3.13(e)), which functions as a cap on reductions in those circumstances.

Direct penalties

The Rules themselves do not prescribe criminal or civil penalties for non‑compliance by participants or third parties. They are an administrative instrument that prescribes how the CEO is to account for compensation when approving participant supports under the Act. Enforcement therefore operates through administrative funding decisions and related recovery mechanisms rather than express fines or offences in the Rules.

Administrative enforcement mechanisms referenced

• Plan revision and funding reductions: The primary enforcement instrument is the CEO’s adjustment of a participant’s plan and the reduction of NDIS funding by the compensation reduction amount (paragraphs 3.4-3.5). This is an administrative action that affects the level of supports provided or funded by the Scheme.

• Amortisation and actuarial discounting: Reductions may be amortised over the participant’s expected lifetime (3.7). The use of actuarial models and the Agency’s published model (3.14) will determine how much funding is brought forward or deferred; incorrect disclosure or failure to provide relevant documents may result in the CEO calculating a larger reduction than would otherwise have occurred.

• Interaction with recovery provisions in the Act: The Rules require the CEO to subtract from a compensation reduction amount any recoverable amount payable by the participant pursuant to section 106 or section 107 of the Act, and any amounts deducted by the Agency under section 105B of the Act (3.13(g)-(h)). Those referenced Act provisions set up recovery and deduction powers that operate as enforcement tools beyond the Rules themselves. The Rules therefore integrate with existing Act mechanisms for recovering overpayments or recouping liabilities where recoverable amounts attach to compensation.

Limits on legal liability for the Agency

• No action lies against the CEO or any other person in relation to advice given about likely compensation reduction amounts when requested under paragraph 3.8 (paragraph 3.9). This provision eliminates a cause of action against the Agency for advice provided under paragraph 3.8.

Discretionary relief

• The CEO may ignore whole or part of a compensation reduction amount in special circumstances, including financial hardship (paragraph 3.10). This operates as a built‑in administrative relief valve, reducing the need for formal appeals or judicial review in some hardship cases, though persons aggrieved may still have other legal remedies available under the Act or general administrative law.

Practical effect

The enforcement architecture is administrative, relying on plan amendments and offsets rather than criminal sanctions. Recoveries under the Act are imported into the computation, channeling enforcement through the recovery and deduction powers in the Act (3.13(g)-(h)). The combination of actuarial valuation, consultation obligations, and CEO discretion creates multiple touchpoints where administrative decisions can be made and challenged through available legal channels, though the Rules themselves do not specify appeal or review procedures. The CEO’s statutory decision‑making is subject to the constraints and review mechanisms of the Act and general administrative law (as signalled by 4.3 referencing the Acts Interpretation Act 1901).

Direct cross-references in the Rules identify a network of legal interactions, primarily with the Act itself and with compensation, social security and health compensation statutes.

Interaction with the National Disability Insurance Scheme Act 2013

• The Rules are made under section 35 of the Act and operate within the planning and funding framework established by the Act. Key procedural mechanisms flow from the Act: the CEO’s role, plan approval and revision duties, and the Agency’s powers to deduct or recover amounts are all Act functions that the Rules modulate (see the opening text and paragraph 4.4 where “Act” and “CEO” are defined).

• The Rules require the CEO to consider the objects and principles of the Act when exercising discretion,explicitly when assessing reasonableness under paragraph 3.2 and implicitly throughout (Part 1 sets out the relevant objects and principles at paragraphs 1.4-1.5). The Rules therefore require the CEO to align compensation treatment with statutory goals such as supporting independence and ensuring reasonable and necessary supports.

Interaction with compensation and social security legislation

• The Rules expressly deduct certain statutory offsets when calculating compensation reduction amounts for judgments/settlements where the NDIS component is not objectively identifiable (paragraph 3.13(b)(i)-(iv)). These include:

  • Health and Other Services (Compensation) Act 1995;

  • Health and Other Services (Compensation) Care Charges Act 1995;

  • Part 3.14 of the Social Security Act 1991;

  • any law of the Commonwealth, State or Territory prescribed by the NDIS rules.

  That list integrates existing statutory recovery and charge regimes into the NDIS’s offset logic, preventing double recovery of costs that are already subject to statutory recovery or charge regimes (paragraph 3.13(b)).

• The Rules also recognise “preclusion” arising from statutory schemes (paragraph 3.13(c)). If a preclusion period arises under a statutory entitlement scheme in respect of the injury, the CEO must subtract an amount the CEO considers reflects the value of that preclusion. The Rules therefore interact substantively with social security entitlement regimes and their effect on a claimant’s eligibility or timing for benefits.

Interaction with state and territory statutory compensation schemes

• When a participant is receiving compensation under a Commonwealth, State or Territory statutory scheme (paragraph 3.1(c)), the compensation reduction amount is the total value of care and support expected to be provided under that scheme until the plan next requires review (paragraph 3.17). The CEO must consult with the scheme administrator (3.18(b)). This creates an operational interface between the NDIS and jurisdictional statutory schemes, with the potential for coordination, data‑sharing and formulaic interaction.

Actuarial and administrative law interactions

• Valuation of periodic payments and lifetime values is to be done in accordance with accepted actuarial standards and in consultation with the scheme actuary (paragraph 3.3; paragraph 3.7 about amortisation). The Agency is to publish applicable actuarial models on its website that govern the computation in some instances (3.14, 3.18(a)). These requirements create an evidentiary and methodological link between Agency practice, actuarial professional standards, and transparency obligations.

Interpretation and legislative instrument rules

• The Rules state that some explanatory boxed text is non‑operative (4.2) and that terms used in the Act have the same meaning in the Rules unless the Rules show a contrary intention (4.3). They also invoke the Acts Interpretation Act 1901 and the Legislative Instruments Act 2003 as applying to these Rules (4.3). That situates the Rules within the broader Commonwealth legislative framework for instrument interpretation and procedure.

Practical implications of interactions

• The Rules effectively pull together compensation awards, statutory entitlements and social security offsets into a single administrative calculation used by the CEO to set NDIS funding. They rely on actuarial models and consultation with other scheme administrators, and they incorporate recovery powers in the Act. This produces an integrated administrative regime for aligning NDIS funding with other sources of support and compensation, but it also creates complexity where different legislative regimes have different definitions, valuation conventions, and administrative timelines.

The text provided is the National Disability Insurance Scheme (Supports for Participants,Accounting for Compensation) Rules 2013 as made on 22 July 2013 (cover page and signature block). The Rules commence on the day they are registered (opening paragraphs). The instrument states it is made for the purposes of section 35 of the Act (opening paragraphs). The Rules reproduce certain Act definitions for convenience (paragraph 4.4) and identify their relationship to the National Disability Insurance Scheme (Supports for Participants) Rules 2013 (paragraph 1.3).

The instrument itself does not record any subsequent amendments, variations, or remade texts within the supplied document. There is no amendment schedule or consolidated notation in the provided text. The Rules require the Agency to publish certain actuarial models on its website at the time calculations are undertaken (paragraphs 3.14, 3.18(a)), which creates a dynamic operational link to materials that may be updated administratively without amending the Rules themselves. Any statutory amendments to the Act that affect the CEO’s role, sections referenced (for example sections 105B, 106, 107), or other interacting legislation could necessitate future amendment of these Rules, but such amendments are not recorded here.

Users should therefore treat this text as the 2013 instrument and verify whether subsequent legislative instruments or legislative amendments have modified its content or interaction with the Act. The Rules themselves refer to the Acts Interpretation Act 1901 and the Legislative Instruments Act 2003 (paragraph 4.3), which govern interpretation and procedural matters for legislative instruments and will affect amendment and application processes. The lack of an amendment history in the printed text is not evidence that no amendments have occurred; it simply reflects the document provided.

The supplied Rules text contains no reference to any litigation, judicial interpretation or case law. It does not name or cite any judicial decisions. There is no internal record of challenges, appeals, or settled authorities interpreting the compensation reduction amount, the CEO’s discretion, or the actuarial modelling requirements within the text provided.

Because the Rules are an administrative instrument governing how the CEO accounts for compensation, litigation challenges would normally arise as administrative law actions or merits review of CEO decisions under the Act, or possibly as disputes about the interpretation of the Act and these Rules in courts or tribunals. However, no such litigation is recorded in this instrument.

Practitioners relying on these Rules should therefore search contemporary case law and administrative decisions outside this text to determine if courts or tribunals have considered:

• the scope of the CEO’s discretion under paragraph 3.10 to ignore reductions in special circumstances;

• the meaning and practical application of “NDIS component” where awards are ambiguous;

• the CEO’s reasonableness assessment under paragraph 3.2 for agreements where participants gave up compensation;

• actuarial valuation disputes regarding periodic payments and amortisation under paragraphs 3.3, 3.7 and 3.14;

• disputes over the application of statutory offsets listed in paragraph 3.13(b).

Absent recorded litigation in this instrument, readers should conduct an independent search of case law and administrative tribunal decisions for decisions interpreting these Rules once deployed in practice.

Multiple compensation amounts and aggregation: The Rules make it possible for more than one compensation reduction amount to apply in respect of the same injury if there are multiple compensation amounts fixed or foregone (paragraph 3.6). Special rules apply to avoid double-counting across the different calculation pathways (paragraphs 3.15, 3.20). Practitioners must track multiple settlements, judgments, statutory payments and any prior plan reductions and apply the cross-reduction steps carefully; failing to do so risks miscalculation and disputed plan funding.

Timing and triggering: The Rules apply to persons who are participants or later become participants where the impairment was caused to any extent by a compensable injury (3.1). A compensation event may pre‑date NDIS participation by many years. For judgments/settlements the NDIS component is defined as relating to supports that may be funded after the date of the judgement/settlement (paragraph 4.4). That temporal reference matters: awards for past supports may be treated differently from awards for future supports.

Valuation of periodic payments: Where a judgment includes periodic payments but the amount attributable to the NDIS component is not specified, the Rules require actuarial valuation in consultation with the scheme actuary (3.3). The Rules do not prescribe a particular discount rate or mortality tables; they require “accepted actuarial standards” and consultation with the scheme actuary. In practice this opens a space for methodological contention.

Amortisation and expected lifetime: Lump sum reductions may be amortised over a period no longer than the participant’s remaining expected lifetime (3.7). How the expected lifetime is determined and which actuarial assumptions apply matter for present value calculations. Paragraph 3.14 ties the calculation in paragraph 3.13(e) to any Agency-published actuarial model, making the Agency’s published model a potential control on variability, but only where that paragraph applies.

50% rule for lost earnings: If no statutory preclusion period applies and the participant claimed damages for lost earnings or capacity to earn, and the judgment or settlement included an amount for those damages, the CEO is to subtract 50% of the compensation (3.13(d)). This specific rule can materially affect fundable amounts and may interact awkwardly with settlements where damages are not neatly compartmentalised.

Preclusion and statutory offsets: The Rules require that the CEO subtract amounts reflecting statutory preclusion and apply statutory offsets from several named Acts (3.13(b)-(c)). Differences in definitions or entitlement periods across schemes could lead to disputes about valuation and the appropriate “amount to be subtracted”.

Agreements to give up compensation: The CEO must be satisfied that it would not have been reasonable in the circumstances for the person to have entered an agreement to give up compensation before treating forgone compensation as a reduction (3.1(d)). The assessment of reasonableness requires the CEO to have regard to enumerated matters including the participant’s disability and the impact on the participant’s family and finances (3.2). That fact‑sensitive assessment creates a procedural and evidentiary burden on participants to explain and document their reasons.

CEO discretion and uncertainty: Paragraph 3.10 allows the CEO to ignore reductions in special circumstances including financial hardship. That discretion introduces uncertainty for participants and insurers as to how reductions will be applied in practice. The Rules require the CEO to have regard to the Act’s objects and principles, but they do not provide a closed list of special circumstances or a reviewable standard, potentially increasing litigation risk.

Advice with no liability: The CEO can advise someone contemplating settlement on likely reduction amounts (3.8) but the Agency is insulating itself from liability for that advice (3.9). Advisers to claimants should be cautious about relying solely on Agency advice because it is non‑actionable and may be superseded by the CEO’s later decision.

Documentation and evidence requirements: The calculation pathways subtract amounts the participant already paid for supports after a judgment/settlement or compensable event (3.11(b), 3.13(f), 3.19(c)). Participants must maintain documentation proving such expenditures. Failure to document may result in larger reductions, and the Rules do not set out detailed evidentiary thresholds for these subtractions.

Agency-published actuarial models: Several calculations hinge on actuarial models published by the Agency (3.14, 3.18(a)). Practitioners must monitor the Agency’s website for the applicable model at the time of calculation. Changes in published models will affect ongoing and retrospective calculations; there is a risk that a model update could change valuations for large cohorts unless the Agency specifies transitional rules (none are in the text provided).

Recoveries under the Act: The Rules reduce compensation reduction amounts by amounts recoverable under sections 106 and 107 of the Act and by amounts deduced under section 105B (3.13(g)-(h)). These cross-references mean that the practical effect of compensation on NDIS funding will be shaped by how the Agency exercises recovery powers under the Act.

Non-operative explanatory text: The Rules state that boxed explanatory text is not operative (4.2). Users should not rely on those explanatory notes as legal provisions; they may, however, illuminate intended operation and practice.

Practical compliance checklist for participants and advisers

1. Disclose compensation early and provide documentation. When applying for participation or during plan reviews, disclose any judgments, settlements, statutory entitlements, or agreements to give up compensation and supply copies of documents. The CEO must take such compensation into account (paragraphs 3.1, 3.4-3.5).

2. Separate and document the NDIS‑relevant component. If a judgment or settlement expressly identifies an NDIS component (paragraph 3.11), ensure that documentation clearly identifies the portion of the award that relates to supports funded by the NDIS. If not identified, prepare evidence that supports valuation of components and, where necessary, engage an actuary to assist (paragraphs 3.3, 3.11, 3.13).

3. Retain records of supports paid after judgment/settlement or compensable event. The CEO must subtract amounts the participant actually paid for supports after the judgment/settlement and before becoming a participant (3.11(b), 3.13(f), 3.19(c)). Keep invoices, receipts and bank records showing that compensation funds were used to purchase services or equipment of the kind funded by the NDIS.

4. Where periodic payments are involved, obtain actuarial valuations. If periodic payments are part of the compensation and their present value is not specified in the judgment, valuations must be made in accordance with accepted actuarial standards and in consultation with the scheme actuary (3.3). Early engagement with an actuary will help the CEO’s assessment proceed smoothly.

5. Consider requesting CEO advice before settlement. The CEO may give advice about likely compensation reduction amounts if asked (3.8). Where strategic settlement choices are being considered, request such advice to inform negotiations, but be aware that the Agency disclaims liability for that advice (3.9) and that the CEO’s later plan decision may differ.

6. Document and, where relevant, prepare to justify any decision to give up compensation. If there is an agreement to give up compensation, the CEO will assess whether it was reasonable to enter into the agreement and will have regard to specified factors including the participant’s disability and the financial impact on the participant and family (3.1(d), 3.2). Prepare contemporaneous evidence (medical, legal advice, financial impact statements) to support a reasonableness account.

7. Track prior plan reductions and prior compensation reduction amounts. The Rules require subtraction of any prior reductions that occurred in relation to a participant’s previous plan (3.11(c), 3.13(i), 3.19(b)). Maintain a clear history of plan decisions and reductions to avoid double subtractions or erroneous calculations.

8. Engage with statutory scheme administrators where a statutory scheme is involved. For compensation under Commonwealth, State or Territory statutory schemes, the CEO must consult the administering entity when identifying expected care and support (3.18(b)). Work proactively with administrators to ensure accurate estimates are available.

9. Monitor Agency actuarial models and methodology. Several calculations must follow any applicable actuarial model published by the Agency at the time the calculation is undertaken (3.14, 3.18(a)). Subscribe to Agency updates and ensure calculations use the correct version of the model.

10. Prepare to apply for special‑circumstances relief if warranted. If a participant faces financial hardship or other special circumstances, the CEO has discretion to ignore whole or part of a compensation reduction amount (3.10). Compile evidence of hardship (financial statements, care needs, incapacity to manage funds) to support an application for relief.

Practical compliance checklist for agencies, actuaries and scheme administrators

1. Establish clear processes for receiving and recording compensation documentation, judgments and settlements.

2. Maintain an up‑to‑date actuarial model(s) on the Agency website and document the methodology used so that calculations under paragraph 3.13(e) and 3.17-3.18 rely on a published model. Ensure transparency about inputs and assumptions.

3. Set up consultation protocols with the scheme actuary and scheme administrators to fulfil consultation requirements in paragraphs 3.3 and 3.18(b).

4. Train decision‑makers on the required sequence of subtractions in paragraph 3.13 and in the cross‑reduction rules at 3.15 and 3.20 to avoid double counting.

5. Create standard templates for seeking evidence from participants about amounts paid for supports after a judgment/settlement or compensable event.

6. Build amortisation calculators that comply with accepted actuarial standards and allow amortisation over no more than the participant’s expected lifetime (3.7).

7. Document the CEO’s exercise of discretion under paragraph 3.10 and record reasoning about special circumstances, including financial hardship.

8. Publish guidance for legal practitioners and insurers about how the Agency treats settlements and the availability of CEO advice under paragraph 3.8, clarifying the non‑actionable nature of that advice (3.9).

9. Coordinate with social security, health compensation and other statutory schemes to reconcile offsets and preclusion values (3.13(b)-(c)). Establish memoranda of understanding where data sharing will improve the accuracy of forecasts.

10. Create appeal and review pathways consistent with the Act and administrative law obligations where participants dispute the CEO’s compensation reduction amount or the reasonableness assessment under paragraph 3.2.

Recordkeeping, evidence and audit

The Rules place evidentiary value on documentary proof of compensation instruments, payments made for supports, prior plan decisions and actuarial valuations. For participants and advisers the practical compliance burden is administrative: collect and preserve relevant documents; engage actuaries early for valuations; and seek CEO advice where settlement decisions are live. For the Agency and decision‑makers the burden is methodological and procedural: maintain models, consult appropriately, apply the detailed subtraction sequence in the relevant paragraph, and ensure transparency in decisions that materially reduce plan funding.