# 4.1.1 Redress payment - method statement

## Methodology

This topic outlines the methodology to calculate the redress payment amount for a person, and each responsible institution's liability for a redress payment, when the Operator has approved an application for redress.

The method is as follows:

Step Action Act reference
1

Assessed maximum amount

Apply the assessment framework to work out the maximum amount of the redress payment that could be payable to a person. The amount cannot be more than \$150,000.

NRSAct section 30

NRS Rules section 23

2

Group into sets of abuse where there is more than 1 set of abuse

Group the abuse experienced by the survivor into 'sets' of abuse. A set of abuse is all abuse for which the same combination of institutions are responsible, regardless of whether they are participating in the Scheme.

If the person is a child migrant refer to 4.1.3 to work out the institutions' share of the maximum amount.

NRS Rules section 22
3

One set of abuse - gross liability

If there is only 1 set of abuse, work out the institution's share of the maximum amount:

• Maximum amount determined in step 1 ÷ Number of institutions that are equally responsible for that set of abuse (which may be 1)
• Round to 6 decimal places (4 decimal places of a cent).
• Go to step 8.

NRSAct section 30 step 2 of the method statement

NRS Rules section 23

Apply steps 4 to 8 where there is more than 1 set of abuse as worked out in step 2.

4

Notional amount for each set

For each set of abuse work out how much the maximum amount would be according to the assessment framework, as if it was the only set (this will be used to 'weight' the sets of abuse against each other in step 6).

NRS Rules section 24
5

If applicable, deduct any non-participating institutions' share from set

If a set of abuse contains a non-participating institution/s that is equally responsible with a participating institution/s, adjust the weighting to be a fairer split for institutions. To do this, apply the following formula:

• Amount worked out under step 4 × Number of participating institutions ÷ Number of responsible institutions
• Round to 6 decimal places (4 decimals of a cent). Amounts are rounded to 6 decimal places to ensure amounts could be accurately rounded to the whole dollar.
NRS Rules section 25
6

Share of the maximum amount for each set of abuse

Work out each institution's share of the maximum amount. To do this, apply the following formula for each set:

• Amount from step 4 or 5 ÷ Sum total of the notional maximum amounts for all sets × Amount determined in step 1
• Round to 6 decimal places (4 decimals of a cent).
NRS Rules section 25
7

Share of the maximum amount for each institution

Work out each institution's share by applying the following formula for each institution:

• Amount determined in step 6 ÷ Number of participating institutions responsible for the set (which may be 1)
• Round up to the next whole cent.
NRS Rules section 25

8

Calculate institution's gross liability

Work out each institution's gross liability amount by adding up the institution's liability across all sets of abuse.

NRS Rules section 25(5)
9

Identify any relevant prior payments, adjust for inflation (this is the 'reduction amount')

Identify any past payments (or portions) made by responsible institutions (or their associated institutions) paid in recognition of harm caused by abuse in scope of the Scheme, or in recognition of abuse. Where a prior payment was made on behalf of more than 1 institution, equally split the prior payments across the relevant institutions.

• Prior payment × (1.019)n
Where n= number of whole years since payment paid.
• Round to the nearest cent.
NRSAct section 30(2) step 3 and 4 of the method statement
10

Final liability: deduct reduction amount from institution's share

Calculate each institution's total liability by deducting adjusted relevant prior payments from the gross liability amount. Apply the following formula:

Institution's final liability = Institution's gross liability calculated in step 8 or step 3 − Amount determined in step 9

NRSAct section 30(2) step 5 of the method statement
11

Find redress payment by adding institutions' liabilities

Add together all participating institutions' liability worked out in step 10. This total amount should be paid to the survivor.

NRSAct section 30(2) step 6 of the method statement)
12

To work out the administrative charge for each institution, apply the following formula to redress payments made in that quarter:

• Gross liability calculated in step 3 or step 8 × 0.075
• Round up to the nearest whole cent.
NRS Rules section 67(2)(a)
13

Calculate institution's share of \$1,000-per-claim legal contribution

To work out the institution's share of the \$1,000 per claim 'legal contribution', apply the following formula to redress payments made in that quarter:

• Gross liability calculated in step 3 or step 8 (for the institution) ÷ Total of all gross liability amounts calculated in step 3 or step 8 (sum of all institutions) × \$1,000
• Round up to the nearest whole cent.

Note: If the institution is the only liable participating institution for a redress payment, they will pay \$1,000.

NRS Rules section 67(2)(b)

If the Operator applies the method statement to calculate the share of costs for a liable institution, and that institution is a participating defunct institution, special requirements under section 165 of the NRSAct may apply where a government institution is a funder of last resort.

Act reference: NRSAct Part 2-3 Division 4 The Operator must determine whether to approve the application

NRS Rules Part 6 Division 2 Requirements for working out institution's gross liability amount

Policy reference: Redress Guide 4.1 Redress payment (monetary payment)

Last reviewed: 13 August 2018