Victoria Legal Aid Handbook for Lawyers

Our debt policy explains how we deal with overdue contributions.

The underlying principles of our debt policy are that:

Our debt policy covers how we deal with:

  • payments that are overdue
  • reviewing contributions secured over real property, and
  • reducing, waiving or removing contributions.

Overdue contribution payments

If an assisted person doesn’t pay their contribution on time, we may cancel their grant.

If an assisted person can’t keep up with the payment plan, they can call or write to us to discuss changing it.

If a contribution is overdue by 60 days, we will write to the assisted person to tell them:

  • how much is overdue
  • how to make the payment, and
  • how the contribution can be reduced if their financial circumstances have changed.

If the contribution remains overdue, we can refer the debt to a debt collector or start court proceedings to recover what has not been paid.

Effects of overdue payments on any additional grants

If an assisted person has an overdue contribution and wants another grant, we will still ask for that contribution to be paid.

If their financial position has changed, then we will reassess the amount owing.

Reviewing contributions secured over real property

A contribution secured over real property remains until the property is sold, or until the contribution has been paid.

Once a grant is over, we will send the assisted person a letter advising:

  • that there is a contribution secured over their property
  • how much is owing, and
  • to update us if their financial circumstances have changed.

The letter will include a financial statement that can be completed and sent back to us so that we can review the amount owing.

We will send a letter once a year.

When a financial statement is returned, or we are contacted with updated financial information, then we will decide whether:

  • the contribution amount should be changed
  • the caveat should be removed from the property, or
  • the contribution should be waived.

Reducing, waiving or changing contribution payments

Where an assisted person:

  • can’t keep up with their instalment plan, or
  • feel like the amount owing is too large, or
  • have altered financial circumstances,

they can write or call Grants and Quality Assurance and ask that the contribution is changed. We are more likely to alter the contribution if an assisted person is experiencing financial hardship.

What is financial hardship?

Financial hardship is when an assisted person can’t pay their contribution because they:

  • need their income, asset or settlement money for ongoing medical expenses for themselves or their family
  • are no longer receiving a Centrelink payment and do not have enough money to support themselves, or
  • have experienced a crisis that prevents them from making ongoing payments.

Note: This is not a complete list of situations that would be considered financial hardship.

How can the contribution be changed?

The contribution can be changed in the following ways:

  • The amount to be paid each month can be varied
  • The overall amount owing can be reduced
  • The payment plan can be paused, or
  • The overall amount can be waived so there is no more contribution owing.

Reviewed 21 February 2022

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