New Veterans’ Entitlements Harmonisation Legislation (Starting 2026) – Explained

Official Name of the New Act

The Australian Parliament has passed a major reform law called the Veterans’ Entitlements, Treatment and Support (Simplification and Harmonisation) Act 2024, commonly referred to as the VETS Actdva.gov.au. This Act was created in response to a Royal Commission recommendation to simplify and harmonise the complex framework of veteran compensation and rehabilitation lawsdva.gov.au. The VETS Act effectively merges the three existing veterans’ compensation systems into one. It does this mainly by amending the Military Rehabilitation and Compensation Act 2004 (MRCA) to serve as a single, improved system. From 1 July 2026, two older laws – the Veterans’ Entitlements Act 1986 (VEA) and the Safety, Rehabilitation and Compensation (Defence-related Claims) Act 1988 (DRCA) – will stop accepting new compensation claims, with all new claims to be handled under the updated MRCA insteaddva.gov.au.

How the New Act Differs from the MRCA 2004

Under the new harmonised system, all veteran compensation claims will be dealt with under a single Act (the improved MRCA) rather than three separate Acts. This consolidation is expected to make the system easier to navigate and more consistent, both for veterans and for the Department of Veterans’ Affairs (DVA) staff processing claimsdva.gov.au. The VETS Act introduces several key changes and enhancements to the MRCA 2004 framework:

• Single Claim Pathway: Regardless of when or where a veteran served, any new claim lodged on or after 1 July 2026 will go through the one MRCA process. This eliminates differing eligibility rules and duplication between the old Actsdva.gov.au.
• No New Claims under Old Acts: The VEA and DRCA will be closed to new claims (though they remain in place to continue paying existing benefits). This removes the need to decide which Act to apply under and ends the complexity of offsetting payments between Actsdva.gov.au.
• “Grandfathering” of Existing Benefits: All current payments under VEA and DRCA are preserved – there will be no forced changes or cuts to what veterans already receive. These ongoing pensions or compensations will continue uninterrupted and will still be indexed as usualdva.gov.audva.gov.au.
• New and Improved Benefits: The amended MRCA will include new benefits and expanded eligibility compared to the original MRCA:
  • An Additional Disablement Amount (ADA) payment will be introduced, similar to the VEA’s Extreme Disablement Adjustment (EDA). This provides extra compensation for veterans of Age Pension age or older who have a high level of incapacity from service-related conditionsdva.gov.au.
  • The law will allow for presumptive liability for certain conditions – meaning the Repatriation Commission can declare some injuries or diseases as service-related by default if evidence shows they are commonly caused by military servicedva.gov.au. This can simplify and speed up accepting claims for those conditions.
  • Broader support services: Eligibility for services like household help and attendant care is being expandedto cover more veterans who need these services due to their accepted conditionsdva.gov.au. Travel for treatment will be reimbursed at a higher rate for all private vehicle travel (removing previous distance thresholds)dva.gov.au.
  • Standardised allowances and payments: Various supplementary payments will be aligned into the one system. For example, things like education support for children of incapacitated veterans, emergency support packages, and additional payments for veterans’ children will be standardised across the boarddva.gov.au. Funeral benefit rules are also updated – the automatic VEA funeral benefit is retained and increased, and all service-related deaths will attract up to a specified higher reimbursement for funeral costsdva.gov.au.
  • Streamlined administration and oversight: The Military Rehabilitation and Compensation Commission and Repatriation Commission are being merged into a single commission, simplifying governance of veteran supportaph.gov.au. Additionally, if a Statement of Principles (the medical rules for conditions) is updated while a claim is in review, DVA will apply whichever version of the rule is more favorable to the veterandva.gov.au. The Commission will also have new powers, such as requiring certain veterans to get financial advice before taking large lump-sum payouts, to help veterans make informed choicesdva.gov.au.
• Incapacity Payments Alignment: Veterans who were getting DRCA incapacity payments (payments for lost earnings capacity due to injury) will be automatically transferred to MRCA incapacity payments at the changeover datedva.gov.au. Importantly, this transition comes with an increase – the newer MRCA system’s rates will apply, and no one will have their payment reduced in this processthemandarin.com.authemandarin.com.au.

In summary, the new Act doesn’t abolish the MRCA 2004 but rather updates and expands it. It differs from the old MRCA by incorporating features of the other Acts (like the EDA-equivalent ADA payment and presumptive condition rules) and by functioning as the one-stop legislation for all veteran compensation going forward. The goal is a fairer, more user-friendly system with consistent outcomesdva.gov.au.

What It Means for Veterans and Claim Submissions

For new claims: From 1 July 2026, veterans (and serving ADF members transitioning to veteran status) will only need to lodge claims under the MRCA – regardless of their service era or type. If a veteran has never made a claim before or is claiming for a new condition, they will use the one harmonised scheme. This should simplify the process, as veterans and advocates no longer have to figure out which of the three Acts applies to their service or condition. All claims made after the commencement date will be under the improved MRCA with its unified rulesdva.gov.au. The DVA is gearing up with training and support for this transition period to ensure veterans and families understand the new systemaph.gov.audva.gov.au.

For existing claims and benefits: If a veteran is already receiving a pension or compensation under the VEA or DRCA before July 2026, they do not need to reapply or move to the new Act. Those ongoing payments are “grandfathered,” meaning they will continue without interruption under the old law that granted themdva.gov.au. For example, if you are on a VEA Disability Pension or a DRCA lump-sum payment was already made, those remain in place. There is no requirement to transfer an existing accepted condition to MRCA, and indeed the old Acts will remain operational in a limited way to maintain those entitlements.

Resubmitting previously rejected claims: One important change is that the new legislation explicitly allows veterans to resubmit claims that were previously rejected under the VEA or DRCA and have them considered afresh under the MRCA’s rulesaph.gov.au. In practical terms, if a veteran had a claim denied in the past (for instance, a condition not accepted under older rules or evidence), after 1 July 2026 they can lodge a new claim for that same condition under the MRCA. The condition will be assessed under the MRCA’s criteria (which might include more up-to-date medical rules or presumptive conditions), potentially giving the veteran another chance to obtain acceptance and compensationaph.gov.au. This is significant for veterans who may have exhausted appeals or had no recourse under the old system – the harmonisation reform offers a “second chance” for previously declined conditions via the new single pathway.

It’s worth noting that if a claim is already in progress before 1 July 2026 under one of the old Acts, it will continue and be determined under that existing Act’s rules (since the new system applies to claims received on or after 1 July 2026)dva.gov.au. Veterans in that situation won’t need to withdraw and resubmit; DVA will finish those under the old law. However, any new claim after that date (even by a veteran with existing VEA/DRCA benefits) goes to MRCA. The delayed start date of 2026 is intended to give everyone time to prepare and avoid confusion or rushed changesdva.gov.au.

How VEA Impairment Points Will Translate in the New System

Under the VEA, veterans receive a Disability Compensation Payment (DCP) which is based on an assessed level of impairment (often expressed as a percentage of the general rate, e.g. 50% DCP) for accepted conditions. In the new harmonised system, these previously assessed VEA disabilities will be recognized when a veteran makes a new claim under MRCA. Essentially, DVA will perform a “whole-of-person” impairment assessment for the veteran under the MRCA’s impairment rating guide, and it will include the veteran’s prior service-related impairments as a baselinedva.gov.au.

In practice, when a VEA veteran lodges a claim after 1 July 2026 (either for a brand new condition or for a worsening of an existing condition), the following happensdva.gov.au:

• DVA will use the Guide to Assessment of Rates of Veterans’ Pensions – MRCA Edition (GARP M) to assess the veteran’s total impairment from all service-related conditions. This now becomes the single tool for all assessments (replacing the separate guides previously used under VEA, MRCA, and DRCA)dva.gov.au. A new chapter in this guide accounts for conditions that were already compensated under VEA or DRCAdva.gov.au.
• The veteran’s existing VEA-compensated conditions are converted into an equivalent impairment rating (points) in the MRCA system. This is the “assessed baseline” reflecting what the veteran has already been compensated fordva.gov.au. For example, if a veteran was on a 50% disability pension under VEA, that level of impairment will correspond to a certain number of impairment points in the MRCA scale.
• Next, the additional impairment from any new conditions or worsening is assessed and added on top of that baseline. MRCA will not pay twice for the same impairment that the VEA has already covered; instead, it will pay for the incremental impairment beyond the baseline. (In technical terms, the MRCA’s section 71 “additional compensation” provisions are used, treating the VEA-accepted condition as if it were an existing MRCA conditionaph.gov.au.)
• The outcome is a new overall impairment point total under MRCA, and the veteran will be offered permanent impairment compensation under MRCA accordingly. This can be taken as regular fortnightly payments or as a lump sum (or a combination), at the veteran’s choice – an option that did not exist under the VEA’s pension systemdva.gov.audva.gov.au.

To illustrate, consider a hypothetical example based on a scenario provided by DVA: A veteran was receiving a 10% DCP under the VEA for some minor injuries (this 10% DCP is roughly equivalent to 15 impairment points in the MRCA scale for those conditions)dva.gov.au. After July 2026, the veteran claims a new service-related hearing loss. Under the new MRCA assessment, their previously compensated conditions count as 15 points of impairment (baseline) and the new hearing loss adds additional points, bringing their total impairment to, say, 28 pointsdva.gov.au. MRCA will then pay compensation corresponding to the 28-point level, but it will factor in that the veteran was already compensated for the first 15 points (through the VEA pension). In the example, the veteran kept their VEA pension for the original conditions and received an MRCA payment (or lump sum offer) for the difference, resulting in a higher overall compensation than beforedva.gov.au. The key point is that no impairment that has already been paid for will be lost – it’s acknowledged in the new system so that veterans only gain or break even, not lose out.

For VEA veterans, another change is that some may become eligible for benefits under MRCA that didn’t exist in VEA. For instance, if their total impairment is assessed at 80 points or more under the MRCA scale and they have dependent children, they could qualify for MRCA’s additional payment for those children (a benefit previously only in MRCA)dva.gov.au. Also, veterans above pension age with severe impairments could get the new ADA payment in MRCA (though VEA veterans already on EDA would keep that). Overall, any new MRCA payments will take into account what the veteran already receives under VEA, ensuring a smooth translation of impairment levels and no double-counting or reduction of compensationdva.gov.au.

How DRCA Impairment Points Will Translate in the New System

The DRCA (Defence-related Claims Act 1988) operated more like a workers’ compensation style system, often involving lump-sum payouts for permanent impairment and weekly payments for income loss (incapacity). Under the new harmonised scheme, DRCA will also cease to accept new claims after 1 July 2026, and MRCA will handle those claims insteaddva.gov.au. For veterans with prior DRCA claims, the approach is similar to VEA in that any previously compensated impairment will be recognized as a baseline in the MRCA system.

Here’s how it works for DRCA casesdva.gov.au:

• Converting past DRCA assessments: DVA will establish a process to convert historical DRCA impairment assessments into the MRCA’s impairment point scaledva.gov.au. This means if a veteran had, for example, a 20% whole-person impairment assessed under DRCA for which they received a lump sum, that 20% will be translated to an equivalent point score under the MRCA guide (GARP M). This translated score becomes the veteran’s baseline impairment in the MRCA system for those conditions.
• Baseline for new claims: Once that conversion is done, any new claim for a condition or a worsening of a DRCA-covered condition after 2026 will use the MRCA’s whole-person assessment. The veteran’s existing DRCA-compensated injury is treated as already accounted for (as if they had that impairment under MRCA from the start). The MRCA will only provide new permanent impairment compensation if the veteran’s overall impairment increases by at least a minimal amount (5 impairment points increase is generally the threshold for additional compensation under MRCA)aph.gov.au. Essentially, MRCA picks up where DRCA left off in terms of impairment level.
• No loss of past payments: Importantly, any lump sum the veteran received under DRCA remains theirs – the new system will not claw it back or reduce future entitlements because of itdva.gov.au. If the veteran was on ongoing incapacity payments (weekly wage-loss) under DRCA, those will transition to MRCA’s incapacity payments automatically in July 2026dva.gov.au. The MRCA payments in many cases will be equal or higher, due to updated calculations, and the law explicitly ensures veterans will not get a lower amount after the switchthemandarin.com.authemandarin.com.au.
• Single impairment guide: Just as with VEA, all impairments will be evaluated under the one MRCA guide. DRCA cases might need fresh medical assessments or a translation of old assessments, but this will be handled so that the veteran’s prior compensated impairment is credited in the new system. For example, if a veteran had two DRCA lump-sum payouts for two injuries, those will be converted into one combined impairment rating in MRCA to form the starting point for any new MRCA claim.
• Future benefits: Once under MRCA, the veteran can potentially access MRCA-specific benefits (like choice of lump sum vs periodic payments for any new compensation, or additional benefits for dependants) which didn’t exist under the DRCA scheme.

In short, DRCA veterans will not lose any ground – their previously paid impairment is acknowledged (in point form) and any further deterioration or new injury will be compensated on top of that baselinedva.gov.au. They also gain the advantages of the MRCA system’s flexibility and potentially more generous benefits going forward.

Who in the Veteran Community Is Affected and How

This harmonisation reform affects almost every part of the veteran community, but in different ways depending on each person’s circumstances. Here’s a breakdown of who is affected and how:

• Veterans who will make new claims (on or after 1 July 2026): Whether you are still serving or already separated from the ADF, all new compensation claims will fall under the single MRCA umbrelladva.gov.au. This means that younger veterans (who in the past would have been under MRCA anyway) and older veterans (who might previously have claimed under VEA or DRCA) now use the same process. The positive impact here is a simplified experience – one set of forms, one set of criteria, and one schedule of benefits. It should be clearer what you’re entitled to, and DVA expects quicker and more consistent decisions with only one Act to administeraph.gov.au. New claimants also benefit from the improvements in the law, such as presumptive condition acceptance (for certain illnesses known to be linked to service) and a more modern suite of benefits (for example, options to take lump sums, expanded home care support, etc., as described above).
• Veterans currently on VEA benefits (older Acts beneficiaries): This group includes many older veterans (such as Vietnam War or earlier, and some peacetime veterans) who are receiving VEA Disability Pensions, war widow/er pensions, or other allowances under the VEA. These veterans are assured that their existing payments will continue, with no reductionsdva.gov.audva.gov.au. They do not need to switch to MRCA for conditions already accepted – those will keep being paid under VEA, and indexation will go on as normal. However, if they develop a new condition related to their service or if an existing service injury worsens, any new claim after 2026 has to be made under MRCA (since VEA will not take new claims)dva.gov.au. In practical terms, a VEA veteran might find the process for additional claims a bit different – for instance, the compensation for a worsening might come as a lump sum or new MRCA payment instead of an increase to the VEA pension. They might undergo a whole-person impairment assessment under MRCA’s system. It’s a change in procedure, but the DVA will account for what they’re already getting so that the veteran is not worse off. Also, veterans in this cohort who previously had claims rejected under VEA have the opportunity to try again under MRCA’s rules, as noted above, which could be beneficial if medical science or eligibility criteria have changed in their favor.
• Veterans currently on DRCA benefits: This includes ex-ADF members (or dependants) who had injuries/illnesses from service in the period roughly 1988–2004 (or later non-warlike service) that were covered by the DRCA. They might be receiving weekly incapacity payments or might have received lump sum impairment payouts, or have coverage for treatment under DRCA. For these veterans, the change means no new claims under DRCA after 2026 – any new matters go to MRCA. Those who are on long-term incapacity payments will see an automatic transition to MRCA payments on 1 July 2026dva.gov.au. The effect should be neutral or positive (the law guarantees no reduction in payment ratethemandarin.com.au, and in fact the MRCA calculations may yield an increase in some casesthemandarin.com.au). If a DRCA recipient’s condition worsens later, instead of reopening under DRCA, they would file a claim under MRCA to assess the increase in impairment. DRCA veterans also benefit from things like access to the Veteran Review Board for appeals (which is being extended to cover former DRCA cases), and they get options like lump sum conversion of new benefits. Their medical coverage and rehabilitation support should continue seamlessly, just authorized under MRCA law after the changeover. Essentially, this group will join the single system with recognition of their past payouts and with safeguards that they won’t be disadvantaged by the transitiondva.gov.au.
• Veterans already under MRCA (post-2004 service): For those who have been covered by MRCA all along (e.g. Iraq/Afghanistan-era veterans, or recent peacetime service), the changes are mostly positive enhancements. Their existing MRCA benefits remain, but the law improvements apply to them too. For example, an MRCA veteran reaching Age Pension age with serious impairment can now receive the new ADA extra payment (similar to how VEA veterans had EDA)dva.gov.au. They will also see improvements like the expanded household and attendant care services, higher travel reimbursements, and so on that are introduced by the VETS Actdva.gov.au. Additionally, having more veterans consolidated into one Act might eventually improve claim processing times and consistency, which benefits this group as well. So, MRCA veterans are affected in that their Act is changing (with new provisions), but not in a way that reduces any entitlements — it generally lifts or adds benefits and simplifies certain rules.
• Dependants and families of veterans: The harmonisation also touches surviving spouses, children, and other dependants. War widow/er pensions under the VEA will continue for those already receiving them (those are lifetime pensions for widows of war service personnel, for example). In the future, if a veteran passes away due to service-related causes, the compensation for dependants will predominantly be under MRCA. One notable thing is that if the veteran’s service was before July 2004 (which traditionally would have been under VEA), the dependants can now claim under MRCA as well if that is beneficial, although some categories of dependants will remain eligible under VEA automatically in certain casesaph.gov.au. The idea is to ensure no dependant loses access – the system will, in some cases, provide choice or preserved rights. Moreover, benefits like funeral expenses and education/support payments for children have been standardized and in some instances increased, which directly affects familiesdva.gov.audva.gov.au. For example, all service-attributable deaths will now have the same higher level of funeral cost reimbursement, and children of severely impaired veterans will have the same support regardless of which Act their parent was underdva.gov.au. Families should also find it easier dealing with DVA when there’s only one set of rules to understand for compensation.
• Veteran community at large and advocates: Finally, the broader veteran community – including ex-service organizations, advocates, and support networks – is affected in the sense that the claims environment they work in will change. Advocates will have to become familiar with the new single system (many already are, given MRCA’s existence, but they will now apply it to all clients). The government has been providing training and a transition period so that by 2026, support staff and advocates are ready to assist veterans under the new schemeaph.gov.au. In the long run, this reform is expected to reduce confusion and administrative hurdles, which is a benefit for everyone involved. It addresses long-standing calls from various inquiries to streamline the overly complex compensation legislation for Australian veterans.

In conclusion, the VETS Act harmonisation is a significant overhaul but is designed to be implemented with minimal disruption to individuals’ current benefits. No one will lose what they have now – the changes are mostly forward-lookingthemandarin.com.au. Veterans and their families should experience a more straightforward system for any future claims, and over time, more consistent outcomes. It’s advisable for any veteran or family member with questions about how their specific situation is affected to consult DVA’s resources or reach out to an advocate, but the core message is that this new single Act will unify and improve veteran compensation in Australiadva.gov.audva.gov.au.

Sources: Official Department of Veterans’ Affairs announcements and factsheetsdva.gov.audva.gov.audva.gov.au, the Parliament of Australia Bills digest and committee reportsaph.gov.au, and related DVA guidance documentsdva.gov.audva.gov.au. These provide further technical detail and scenarios illustrating the changes. All indicate strong safeguards to ensure veterans are better off (or at least no worse off) under the new harmonised legislation.