Injured veterans are being made to wait for compensation as key deadlines are missed.
The Department of Veterans' Affairs has met only one out of 13 performance indicators for compensation payments and support to injured former and current serving defence force personnel.
The targets set time frames for the processing of claims.
Department secretary Alison Frame told a parliamentary hearing the numbers moved up and down depending on how many of the older claims in the backlog were being prioritised for processing.
However, she said claims were being processed within the target of 50 per cent within 100 days since December 2023.
The latest data showed the department was receiving claims at an increased rate, she told the hearing on Wednesday.
Greens senator David Shoebridge grilled officials about the data, asking about the missed targets in the department's latest annual report.
"You can accept that once or twice, but it can't be the ongoing explanation for a failure near the target, and it's got worse," he said.
The department also failed to meet performance targets in providing disability support and assistance to defence widows and dependants.
More than 500 extra staff were hired to help clear a huge compensation claims backlog, which at its peak in late-2022 reached 45,000 in the queue.
Independent senator Jacqui Lambie asked why an oversight body, recommended by the royal commission into defence and veteran suicide, hadn't already been set up ahead of an expected vote on legislation to simplify compensation rules.
"Your first priority should have been setting up that body," she said.
"It just blows me away."
Ms Frame said the department was following the timelines set by the royal commission, which called for the harmonisation of the rules by July 2025.
But the legislation, introduced in July by Veterans' Affairs Minister Matt Keogh to roll three laws into one to streamline the process, won't kick in until July 2026.
The government will formally respond to the commission's final report, which made 122 recommendations, by the end of 2024.
The hearing was told the veterans' affairs department was working with the Australian Federal Police to develop training aimed at better equipping officers to respond to crisis calls in a more "military-aware" approach.
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