Ex gratia or act of grace payment payments

An ex gratia or act of grace payment is made in the exercise of the prerogative power of Government. A payment may be made if a person has suffered a financial loss or other detriment directly as a result of the workings of Government. This detriment must be of a nature which cannot be remedied or compensated through recourse to legal proceedings (or where it is impractical to do so).

Treasury Circular NSW TC 22-01

Treasury Circular 22-01 is the NSW Government document which governs ex gratia payments by Ministers. This Circular supersedes the TC21-02 Statutory Act of Grace Payments. It sets out how ex gratia applications will be determined by the relevant Minister of the Crown to whom they are made.

Ministers have the power under section 5.7 of the Government Sector Finance Act 2018 (NSW) to make an ex gratia payment if they are satisfied that there are ‘special circumstances’, or other circumstances of a kind prescribed by regulation, which would warrant a payment. There are no other circumstances prescribed by regulation. Each Minister has a delegation to consider ex gratia payments relating to issues that arise within his or her administrative portfolio responsibility. Applications based on issues that do not fall within the Attorney General's portfolio responsibilities cannot be considered by the Attorney General. 

Special circumstances may exist where:

• a person, or persons, have suffered a financial detriment or other detriment as a result of the workings of government; and 
• the State has no present legal obligation to compensate the person for that detriment; but 
• it is nonetheless morally justifiable for the State to make a payment in the circumstances. 

It is in the very nature of the power that the circumstances in which it is exercised are at the discretion of the relevant Minister or the Minister’s delegate. There is no formal or mandatory criteria for ex gratia applications. It is impossible to specify the range of matters for which an ex gratia payment would or would not be appropriate. Every case is considered on its own facts and in its own context. However, the following principles are usually relevant and should be addressed, with supporting documentation where appropriate: 

• payment is made in respect of a clear and verifiable loss and in consideration of the circumstances (including financial) of the applicant
• conduct by the applicant which may have contributed to the applicant's position is taken into account in determining whether an ex gratia payment should be made, and if so, the amount of that payment
• evidence of some fault or error in the working of government on the part of an officer or agency under the administrative responsibility of the Attorney General that is directly and significantly responsible for causing the loss (which is not an action that gives rise to a claim on the Department's public liability insurance)
• whether other avenues for redress have been exhausted, including appeal options and statutory schemes
• details of the background and factual circumstances of your application
• details of any extraordinary or special circumstances that would warrant payment

It is generally inappropriate to make an ex gratia payment solely in relation to 'losses' incurred in either the normal operations of the court system, including the appeal process, or due to the vicissitudes of litigation. It is also generally inappropriate to make an ex gratia payment where a class of matters exists. Ex gratia applications will not be considered where a legal liability exists. 

A person who receives an ex gratia payment may be required to sign a Deed of Release or undertake in writing to repay the ex gratia payment from any monies received from another source arising from the same circumstances.

Making an application

This section refers only to making an application with respect to matters relevant to an area within the responsibility of the Department of Communities and Justice and its cluster Ministers (see: https://dcj.nsw.gov.au/about-us/who-we-are-and-what-we-do.html). If your application relates to matters relevant to another department, please direct your enquiries to that department for information on how to make an application.   

Applications for an ex gratia payment should be in writing, providing details and supporting documentation or evidence addressing the bullet points set out above. An application should include reference to the background, special circumstances, verifiable loss and the error or fault.

Legal Assistance

Should you require legal assistance in preparing your application, please contact LawAccess NSW at:

Phone: 1300 888 529

Website: LawAccess NSW

If you are Deaf, and/or find it hard to hear or speak with people, the National Relay Service can assist you by providing SMS relay, video relay, voice relay and other options at 1300 555 727. If you require an interpreter call the Translating and Interpreting Service on 131 450.

Application

Applications should be addressed to the relevant Minister and sent to the relevant business unit within the department.

Applications relevant to matters within the portfolio responsibility of the Attorney General, should be addressed to the Attorney General and marked to the attention of:

Legal
NSW Department of Communities and Justice
Locked Bag 5000
Parramatta NSW 2124

Email: Enquiries-DCJLegal@dcj.nsw.gov.au

Only applications for the Attorney General should be sent to the above email address.