PGPA Act Determination (Recovery of Compensation for Health Care and Other Services Special Account 2025)

This instrument establishes a new special account under the Public Governance, Performance and Accountability Act 2013 (PGPA Act) titled the Recovery of Compensation for Health Care and Other Services Special Account 2025 (the special account). The instrument is made under subsections 78(1) and 78(3) of the PGPA Act (s 3) and, for paragraph 78(1)(a) of the PGPA Act, expressly creates the account (s 5). It specifies the accountable authority responsible for the special account as the Chief Executive Officer of Services Australia (s 6). The text sets out what receipts may be credited to the account (s 7) and the limited purposes for which amounts may be debited (s 8). It also effects a transition from an earlier instrument and account established in 2015 by revoking that instrument and transferring its balance into the new special account as the opening balance (ss 9-10). The instrument’s commencement is tied to external timing in paragraph 79(5)(a) of the PGPA Act or to a fixed date, 22 September 2025, whichever is later (s 2).

Mechanically, the key changes are:

• Creation of a discrete special account named Recovery of Compensation for Health Care and Other Services Special Account 2025 (s 5).
• Designation of the CEO of Services Australia as the accountable authority for that account (s 6).
• Specification of permitted credits: amounts received following a judgment or settlement in relation to a claimant under the Health and Other Services (Compensation) Act 1995 (HOSC Act), and amounts received from any person for the purposes of the special account (s 7).
• Specification of permitted debits: payments consistent with the HOSC Act; payments to Commonwealth entities in relation to benefits, subsidies or schemes related to the HOSC Act; entries to reduce the special account balance without a real or notional payment; and repayments where a court order, Act or other law requires or permits repayment (s 8).
• Revocation of the prior establishing instrument (PGPA Act (Recovery of Compensation for Health Care and Other Services Special Account,Establishment) Determination 2015/06) and transfer of its balance into the new account as the opening balance (ss 9-10).
• A temporary Part 3 (transitional) that will be repealed seven days after revocation of the 2015 instrument, with the effects of Part 3 retained beyond repeal (s 11).

The instrument does not itself create offences, criminal penalties, or new statutory rights beyond specifying accounting arrangements and permitted transactions for the special account. It links operation of the special account closely to the HOSC Act by referring to claimants, compensable persons and Chief Executive Medicare as defined in that Act (s 4). The text therefore operates as an administrative funding and receipts mechanism for amounts arising under the HOSC Act.

The instrument makes several discrete legal-technical choices that determine how receipts and payments tied to the HOSC Act are to be handled in Commonwealth financial records. The main concepts in the instrument are the special account, its permitted credits and debits, its accountable authority, the opening balance derived from a prior special account, and transitional repeal mechanics.

Special account: The instrument establishes the Recovery of Compensation for Health Care and Other Services Special Account 2025 as a special account for paragraph 78(1)(a) of the PGPA Act (s 5). In the PGPA Act architecture a special account is a separate appropriation mechanism; this instrument sets out what may be credited and debited against it (ss 7-8). The instrument names the account throughout as "the special account" (s 4 definitions).

Accountable authority: The accountable authority is the Chief Executive Officer of Services Australia, appointed for the purposes of paragraph 78(1)(d) of the PGPA Act (s 6). The instrument therefore concentrates administrative responsibility and decision-making about credits and debits in a single Commonwealth official. The definitional entry for Chief Executive Medicare is retained but the instrument’s account responsibility is stated in terms of the Services Australia CEO (s 4, s 6).

Permitted credits (receipts): The instrument permits two classes of amounts to be credited to the account (s 7):

1. amounts received following a judgment or settlement made in relation to a claimant under the HOSC Act; and
2. amounts received from any person for the purposes of the special account.

The first category explicitly links receipts to judgments or settlements under the HOSC Act. The second category is broader, permitting payments from any person so long as they are for the purposes of the special account.

Permitted debits (uses): The instrument lists four permitted purposes for debits (s 8):

1. pay a person an amount consistent with the HOSC Act;
2. pay an amount to a Commonwealth entity in relation to a benefit, subsidy or scheme related to the HOSC Act;
3. reduce the balance of the special account (and therefore reduce the available appropriation for the special account) without making a real or notional payment; and
4. repay amounts where a court order, Act or other law requires or permits repayment of an amount received.

Item 3 is notable because it explicitly authorises non-cash debits that reduce the account balance and the corresponding available appropriation for the account without an actual cash movement.

The instrument affects a narrow set of actors by changing where certain receipts and payments are recorded and who administrates those transactions. Primary affected parties are Services Australia as accountable authority, claimants/compensable persons under the HOSC Act, Commonwealth entities receiving payments under authorised debits, and any person who makes payments for purposes of the special account.

Services Australia: The Chief Executive Officer of Services Australia is the accountable authority for the special account (s 6). That office bears administrative responsibility for ensuring credits and debits are applied only as allowed by the instrument. In practice Services Australia will control the ledger entries, account management, reporting, and compliance with PGPA Act rules that apply to special accounts because the instrument specifies the accountable authority in accordance with paragraph 78(1)(d) of the PGPA Act (s 6).

Claimants and compensable persons: The instrument references "claimant" and "compensable person" as defined in the HOSC Act (s 4). The first class of permitted credits are amounts received following a judgment or settlement in relation to a claimant under the HOSC Act (s 7(1)). The first permitted debit is to pay a person an amount consistent with the HOSC Act (s 8(1)). Therefore people who are claimants or compensable persons under the HOSC Act will be the intended recipients of payments from this account, and their entitlements under the HOSC Act will drive flows into and out of the account.

Payors and third parties: The instrument permits "amounts received from any person for the purposes of the special account" to be credited (s 7(2)). This is broadly framed and could include insurers, third-party tortfeasors, liable employers, or other private parties, but the instrument itself does not limit who may pay. Any person who pays amounts intended for the account is affected in that the payment must be credited to the account and will be available only for the instrument’s listed purposes.

Commonwealth entities: The instrument permits payments to Commonwealth entities in relation to benefits, subsidies or schemes related to the HOSC Act (s 8(2)). Commonwealth entities that operate benefits or schemes tied to the HOSC Act could therefore receive reimbursements or transfers from this special account. Those entities will be affected because the account explicitly authorises payments to them for related schemes.

Treasury / appropriation managers: The instrument affects appropriation treatment because item 3 of s 8 authorises reducing the balance (and therefore reducing the available appropriation for the special account) without a real or notional payment. That mechanism will be relevant to those responsible for managing appropriation balances and departmental appropriation accounting.

The instrument confers a set of duties and rights primarily in relation to financial administration of the special account. It does not create new substantive entitlements under the HOSC Act; instead it establishes accounting pathways and authorises specific classes of transactions.

Duties of the accountable authority:

• The CEO of Services Australia is designated as the accountable authority responsible for the special account (s 6). That person therefore has the duty to ensure the account is operated in accordance with the instrument. The instrument does not list operational procedures, but the accountable authority must apply credits and debits only as permitted by the instrument (ss 7-8).
• By establishing permitted credits and debits, the instrument constrains the CEO’s discretion to accepting only the listed credits and making only the listed debits (ss 7-8). This is a statutory duty to confine account movements to the specified purposes.

Rights of recipients:

• The instrument permits debits to "pay a person an amount consistent with the HOSC Act" (s 8(1)). That clause operationalises the right, insofar as the HOSC Act confers an entitlement, to receive payments financed from the special account. The instrument does not itself define entitlement criteria; those remain governed by the HOSC Act. The effect is that if a person is entitled under the HOSC Act, the special account is an authorised source for payment.

Rights of Commonwealth entities:

• The instrument authorises payments to Commonwealth entities in relation to benefits, subsidies or schemes related to the HOSC Act (s 8(2)). This gives Commonwealth entities a right (subject to the instrument’s terms) to be paid from the special account where such payments relate to benefits, subsidies, or schemes connected to the HOSC Act.

Accounting and appropriation mechanisms:

• Item 3 of s 8 explicitly permits the account to be debited to "reduce the balance of the special account (and, therefore, the available appropriation for the special account) without making a real or notional payment." This creates an authorised non-cash debit mechanism. The accountable authority has the duty to apply such a debit only to the extent authorised and in a manner consistent with PGPA Act requirements.

Repayment duties:

• Where a court order, Act or other law requires or permits repayment of an amount received, the instrument authorises debits for that purpose (s 8(4)). The effect is that where legal obligations to repay exist, the special account may lawfully be used to effect the repayment.

The instrument contains no provisions creating criminal offences, civil penalties, or express administrative sanctions. It is an administrative determination that sets the financial architecture for a special account; enforcement of substantive obligations and remedies remain in the statutes and legal processes that give rise to the receipts and payments, notably the HOSC Act and any court orders. The instrument does, however, refer to court orders and other laws as sources of repayment obligations (s 8(4)).

What the instrument does provide that affects enforcement and remedies:

• Repayments: Section 8(4) authorises debits from the special account "to repay amounts where a court order, Act or other law requires or permits the repayment of an amount received." This gives the accounting mechanism to satisfy legal obligations to repay. Enforcement of the underlying repayment obligation is sourced in the court order, Act or other law; the instrument authorises the means of payment from Commonwealth funds.
• Non‑cash debit mechanism: Section 8(3) allows the account to be debited to reduce the balance (and reduce the available appropriation) without a real or notional payment. This is an accounting device rather than a penalty enforcement tool. Nonetheless, it affects appropriation balances and how amounts are reflected in Commonwealth financial statements.

Absence of penalties in the instrument:

• There are no sections imposing fines, imprisonment, or civil penalty regimes on persons for failure to pay into, or to operate correctly with respect to, the special account. Where a failure to comply with obligations exists, enforcement would need to arise from the HOSC Act, the PGPA Act, contractual instruments, or court processes external to this instrument.
• The instrument does not itself set reporting or audit obligations beyond what attaches to special accounts under the PGPA Act; it does not, for example, specify additional record-keeping standards, timelines for payments, or dispute-resolution pathways.

Practical enforcement implications:

• If a payer disputes an obligation to pay an amount that the instrument would credit to the special account (for example, a third party contesting liability for a settlement amount), the dispute remains a factual and legal contest under the relevant substantive law. The instrument’s role is to specify where funds are placed once received and how they may be used.
• If the accountable authority misapplies the account (crediting or debiting contrary to the instrument), remedies would derive from the PGPA Act accountability framework and administrative law, not from this instrument’s text. Because the instrument is made under the PGPA Act, misapplication could raise accountability issues under that Act, but the instrument itself does not create an independent penalty scheme.

This instrument intentionally links to and operates within the frameworks of at least two other statutory regimes: the Public Governance, Performance and Accountability Act 2013 (PGPA Act), under which it is made, and the Health and Other Services (Compensation) Act 1995 (HOSC Act), to which its credits and debits are expressly tied (s 3, s 4). The text also references the Acts Interpretation Act 1901 for the definition of person (s 4). The instrument revokes a prior PGPA Act determination made in 2015 (the RCHCOS Instrument) and transfers that account’s balance into the new special account (ss 9-10). The following interactions are explicit in the instrument.

PGPA Act:

• The instrument is made under subsections 78(1) and 78(3) of the PGPA Act (s 3). It invokes specific paragraphs of s 78 of the PGPA Act in multiple places: establishment of the special account (s 5 invokes para 78(1)(a)), specification of credits (s 7 invokes para 78(1)(b)), specification of purposes for debits (s 8 invokes para 78(1)(c)), appointment of accountable authority (s 6 invokes para 78(1)(d)), and revocation/repeal mechanics under s 78(3) (ss 10-11).
• Because the special account is created under the PGPA Act architecture, the account’s operation will be governed by the PGPA Act’s broader financial management and accountability framework. The instrument does not restate PGPA Act obligations but its existence and mechanics must operate within that Act’s scheme. The text also makes explicit that reducing the balance of the special account reduces the available appropriation for the special account (s 8(3)), a mechanism that interacts with appropriation rules under the PGPA Act.

HOSC Act:

• The instrument imports the definitions of claimant, compensable person, and Chief Executive Medicare from the HOSC Act (s 4). Credits and debits are expressly connected to judgments, settlements and payments consistent with the HOSC Act (ss 7(1), 8(1)-(2)). Thus entitlements and triggering events are governed by the HOSC Act and this instrument provides the funding/receipts arrangement to administer those events.
• Where repayments are required by court order, Act, or other law, s 8(4) authorises the special account to be debited. Some of those orders or statutory repayment obligations may arise under the HOSC Act.

Revocation of prior determination and continuity:

• The instrument revokes the RCHCOS Instrument (2015) (s 10) and requires the crediting of the opening balance equal to the amount standing to the credit of the prior RCHCOS Special Account 2015 immediately prior to commencement (s 9). That interaction preserves continuity of funds and directs that existing balances be transferred to the newly established special account, thereby maintaining accounting continuity across the two special accounts.

The instrument itself contains its own limited amendment and transitional history. It revokes an earlier PGPA Act determination that established a prior special account and transfers that account’s balance to the new special account. The instrument also provides for a short-lived Part 3 that is to be repealed after seven days while preserving the effects of that Part beyond repeal.

Key points from the instrument about its amendment and repeal mechanics:

• Revocation of earlier instrument: Section 10 revokes the RCHCOS Instrument, which is the PGPA Act (Recovery of Compensation for Health Care and Other Services Special Account,Establishment) Determination 2015/06. That revocation is effected under subsection 78(3) of the PGPA Act (s 10).
• Transfer of opening balance: Section 9 requires that the opening balance of the special account (to be credited immediately after its establishment) equal the amount standing to the credit of the RCHCOS Special Account 2015 immediately prior to commencement (s 9(1)-(2). This provision implements a direct financial transition from the 2015 account to the 2025 account.
• Repeal of transitional Part: Section 11(1) states that Part 3 of this instrument is repealed at the end of the seventh day after the revocation of the RCHCOS Instrument under section 10 (date of repeal). In other words, the transitional provisions themselves are temporary and will be removed shortly after the revocation of the 2015 instrument.
• Repeal of definitions: Section 11(2) specifies that on the date of repeal the definitions of RCHCOS Instrument and RCHCOS Special Account 2015 in section 4 are repealed. This is a housekeeping step to remove references to the now-revoked instrument and its 2015 special account from the definitions section.
• Continued effect of transitional actions: Section 11(3) states that despite subsection 11(1) (the repeal of Part 3), the effects of Part 3 of this instrument remain in force after the date of repeal. That preserves the substantive transitional outcomes (for example, the opening balance transfer and the revocation of the prior instrument) even though the transitional text will no longer appear in the instrument after the repeal date.

There are no other amending instruments or historical amendments recorded within this text. The instrument itself replaces the 2015 determination and contains its own internal mechanism to tidy up references to the prior instrument shortly after revocation, while preserving substantive transitional effects. No earlier or subsequent amendment schedules are set out in the instrument beyond those transitional steps. The instrument also contains a commencement mechanism (s 2) tying commencement to a PGPA Act paragraph or to a specified date (22 September 2025), which is relevant to the timing of the transfer and revocation.

The instrument itself contains no litigation history. It names no cases, records no judicial determinations relevant to the account, and does not reference any litigation in its text. There are therefore no adjudicated interpretations of the instrument recorded in the material provided.

Possible areas where litigation or disputes could arise, drawn from the instrument’s mechanics (but not citing any decided cases), include:

• Disputes about whether particular receipts qualify as amounts "received following a judgment or settlement made in relation to a claimant under the HOSC Act" (s 7(1)). Parties may differ about whether an amount arises from a settlement/judgment that is tied to a claimant under the HOSC Act.
• Disputes about whether a payment from a private party is "for the purposes of the special account" (s 7(2)), especially where payors assert alternative uses for funds or challenge the legal basis for the payee’s use of the funds.
• Challenges to the scope or application of the non-cash debit mechanism in s 8(3), particularly where reducing the balance without a real or notional payment affects appropriation transparency or an entity’s budget position.
• Controversies about repayments authorised by s 8(4) where a court order, Act or other law requires repayment; for instance, disputes over whether a repayment obligation has arisen or the correct quantum to be repaid.

None of these possibilities is recorded as prior litigation in the instrument. Any actual litigation would be underpinned by other substantive statutes (for example, the HOSC Act) or by general law (contract, restitution, judicial review of administrative action), and outcomes would depend on those instruments and judicial fact-finding.

Because the instrument is an administrative/financial determination, contested issues are more likely to arise around interpretation, accounting treatment, or the interplay with substantive liabilities under the HOSC Act than under the instrument’s own text. The instrument’s silence on dispute resolution mechanisms means contested points would be litigated or subject to administrative review in the usual forums for statutory disputes.

This instrument contains a handful of technical features and drafting choices that can produce unexpectedly consequential outcomes if not understood. The following points identify specific "gotchas" that practitioners, accountants and compliance teams should note, with precise section references.

1. Broad crediting power (s 7(2)): The instrument permits "amounts received from any person for the purposes of the special account" to be credited. That phrase is capacious. It does not limit the identity of the payer, the legal basis for payment, or the form of the payment. Unless constrained by policy or administrative practice, this could allow a wide range of receipts to be channelled into the special account. Practitioners should verify the intended legal basis and documentation for any third‑party payment credited under s 7(2).

2. Non‑cash debit that reduces appropriation (s 8(3)): The instrument expressly allows debits "to reduce the balance of the special account (and, therefore, the available appropriation for the special account) without making a real or notional payment." This is an accounting device that changes appropriation availability without moving cash. The phrase ties balance reduction directly to appropriation impact. That can affect budgetary numbers, departmental appropriation positions and financial statement presentation. Entities should ensure auditors and appropriation managers understand that the account can be adjusted in this way and that such adjustments may have downstream effects on budget reporting.

3. Narrowly defined permissible debits (s 8): Debits are limited to four purposes. Payments outside those categories will be unauthorised. For instance, the account cannot be used for general health administration costs unless those costs fit s 8(2) (payments to a Commonwealth entity for a benefit, subsidy or scheme related to the HOSC Act). Users must map any proposed expenditure to the instrument’s four categories before debiting.

4. Opening balance reliance on prior account (s 9): The opening balance is the amount standing to the credit of the RCHCOS Special Account 2015 immediately prior to commencement. If there are unresolved disputes, audit qualifications, or mismatches in ledger balances in the 2015 account at that moment, those issues will migrate into the new account. Practitioners should confirm the precise timing and reconciliation that determine the transferred opening balance.

5. Short-lived transitional text but preserved effects (s 11): Part 3 will be repealed seven days after revocation of the 2015 instrument, and its definitional entries will be removed (s 11(1)-(2). Yet s 11(3) preserves the substantive effects of Part 3 after repeal. This drafting means that the instrument will not permanently contain references to the 2015 instrument or special account, but the functional transfer and revocation will have already occurred. Record-keepers must therefore document the transitional steps before the text disappears from the instrument.

This section provides a practical checklist and steps grounded in the instrument’s text to comply with its requirements. The aim is to assist Services Australia as the accountable authority, Commonwealth entities that may receive payments, payors and third parties, and finance and audit teams involved in the transfer and ongoing operation of the special account.

For the accountable authority (CEO of Services Australia) , immediate actions

1. Confirm commencement: Monitor the PGPA Act timing referenced in s 2 to determine the exact commencement date (the later of the day mentioned in paragraph 79(5)(a) of the PGPA Act or 22 September 2025) and prepare to credit the opening balance immediately after establishment as required by s 9(1).
2. Reconcile opening balance: Obtain the ledger and reconciliation for the RCHCOS Special Account 2015 and identify the precise amount standing to its credit immediately prior to commencement. Ensure that amount is credited to the new special account as the opening balance in accordance with s 9(2).
3. Establish internal authority and delegations: Ensure the CEO of Services Australia has delegated internal authority and operational procedures specifying who may approve credits and debits, consistent with the instrument’s permitted categories (ss 7-8).
4. Document policies on acceptable credits: Create or update policies to verify that amounts credited under s 7 fall within s 7(1) or s 7(2). For s 7(2) payments from any person, require documented legal basis, payer identity, and purpose statement confirming the payment is for the special account.
5. Implement controls for permitted debits: Design approval workflows that map each proposed debit to one of the four permitted purposes in s 8. Require legal advice or certification where appropriate that a proposed debit is "consistent with the HOSC Act" (s 8(1)) or relates to benefits/subsidies/schemes connected to the HOSC Act (s 8(2)).
6. Non‑cash debit policy: Draft a policy and accounting procedure to govern the use of s 8(3) debits (reducing the balance without a real or notional payment). Record the reasons for each non‑cash debit, the appropriation impact, approvals, and audit trail to satisfy appropriation managers and auditors.
7. Repayment execution: For repayments required by court order, Act or other law (s 8(4)), set a procedure to accept authenticated orders or legal directions, validate the amount, and process the debit promptly through the special account.

For Commonwealth entities that may receive payments (s 8(2))