Division 2: Cost of living adjustment

TAX ALERT: PACMATE Annex 3.B, item 80.

15.2.10   Purpose
15.2.11   Working out the cost of living adjustment
15.2.12   Dual entitlement
15.2.13   Excluding higher duties allowance from disposable income

15.2.10   Purpose

Cost of living adjustment is a payment to help maintain the purchasing power of members' disposable income, and an equivalent standard of living.

15.2.11   Working out the cost of living adjustment

Work out a member's cost of living adjustment using this formula:
Disposable income   x	Post index  –  100
	100
See: Division 1 Clause 15.2.7, Disposable income for ADF members [ADF only] Clause 15.2.7A, Disposable income for APS employees [APS only] Clause 15.2.8, Post index Annex 15.2.A, Post indexes

15.2.12   Dual entitlement

1.	Dual entitlement means all the following conditions are met.
	a.	A member is eligible for overseas living allowance under this Part.
	b.	The member's spouse or interdependent partner is eligible for a payment that meets both the following conditions.
		i.	It is comparable to overseas living allowance.
		ii.	It is paid under this Part, or associated with other Commonwealth employment.
	c.	The member is posted to the same location as their spouse or interdependent partner.
	Example: A member is posted to Jakarta. The member's spouse is an APS employee in the Department of Foreign Affairs and Trade, and is on a long-term posting to Jakarta for the same period as the member. The member is eligible for overseas living allowance. The member's spouse is paid allowances for living overseas by the Department of Foreign Affairs and Trade. The member has a dual entitlement.
2.	In this case, the Commonwealth will not pay both the member and spouse or interdependent partner the full amount of overseas living allowance.
3.	The Commonwealth will pay one person the full overseas living allowance. The other person will only be paid the cost of living adjustment to help maintain the purchasing power of their salary.
4.	The member and spouse or interdependent partner have the option of choosing the person who will only be paid the cost of living adjustment. The option is set out in this table.

Item	If...	and...	then...
1.	both the member and spouse or interdependent partner would be eligible for overseas living allowance	they jointly nominate the person who will only be paid the cost of living adjustment	the nominated person is entitled only to cost of living adjustment for the posting period.

5.	If the member and spouse or interdependent partner do not choose under subclause 4, this table applies.

Item	If...	and...	then...
1.	both the member and spouse or interdependent partner would be eligible for overseas living allowance and the member has the lower disposable income	they do not jointly nominate the person who will only be paid the cost of living adjustment	the member is entitled only to cost of living adjustment for the period of the posting.
2.	both the member and spouse or interdependent partner would be eligible for overseas living allowance, and they have the same disposable income	they do not jointly nominate the person who will only be paid the cost of living adjustment, and the member has the shorter period of service

15.2.13   Excluding higher duties allowance from disposable income

Higher duties allowance is included in a member’s disposable income if it has been approved for three months or more. The three months must have been continuous.

PACMAN                                                             AL8 (August 2007)                             Chapter 15 – Part 2 Division 2 – 1