Chair, Committee Members,
Thank you for inviting me to appear before this Committee to share with you my views on Division 1 to Part 6 of Bill C-31 – Payments by Veterans Affairs. I also wish to take this opportunity to briefly explain why Veterans Affairs Canada needs to take other measures to improve the support provided to injured or ill Veterans and families under the New Veterans Charter.
Bill C-31 will provide many Veterans, survivors or dependent children with additional financial support as a result of Government’s decision to cease the offsetting of the Pension Act disability pension from other financial benefits, namely: the Earnings Loss Benefit, Canadian Forces Income Supplement and War Veterans Allowance. The one-time payment for these benefits will provide retroactive compensation to cover the timeframe from the date the decision was made to cease the practice of offsetting, to the date that Veterans Affairs Canada implemented the decision.
SISIP clients are receiving retroactivity going back to the start of the program because in the context of an insurance contract, the offsetting of the Disability Pension as “income” was unlawful. However, Veterans Affairs Canada was operating within the full context of the legislation. When confronted with a new understanding of the Disability Pension, a policy change was made to amend the regulation to eliminate the harsh effect this policy was having on Veterans. From an Ombudsman’s perspective there is nothing unfair about what has occurred. Although both situations appear to be similar, they are structurally quite different.
Numerous Veterans have called my Office to complain that the short periods of retroactivity are not fair. They argue that the Federal Court settlement order in the Manuge v. Canada case provides retroactivity back to 1976 for the Canadian Forces Service Income Security Insurance Plan. Consequently, they believe that retroactivity for the affected Veterans Affairs Canada programs should be provided to the date the programs came into force.
I do not believe that this is a matter of fairness. The reality is that the Federal Court decision did not specifically compel Government to change the way it offset the disability pension from Veterans Affairs Canada benefits. But Government made the change anyway. There was also no obligation for Government to provide retroactivity – but it did. This ensures that Veterans are not penalized because of the length of time it took to implement the new policy.
I believe that Government is treating Veterans equitably on a go forward basis by harmonizing how Veterans Affairs Canada and the Canadian Armed Forces deal with the offsetting of the disability pension from respective financial benefits.
Let’s quickly look at retroactivity with another issue in relation to the New Veterans Charter. Right now Veterans are facing the harsh reality of having financial security problems after the age of 65. Veterans Affairs is aware of this situation and acting fully within the existing legislation. From my NVC report you know my goal is to change the legislation to provide better financial benefits after age 65 for the most seriously disabled. When the legislation changes, I will not be pursuing retroactivity. Gaps in meeting Veterans’ needs are identified, legislation is changed and then we move forward. This is no different than what just occurred with the Disability Pension offset. The SISIP Federal Court decision is providing retroactivity within a contractual context.
The most pressing shortcomings to address, and the main source of discontent amongst Veterans, are those related to financial support. Adequate financial support is a key enabler to many intended Veteran outcomes such as successful transition to a new civilian career, reasonable standard of living and quality of life, and improved physical and mental health. There are five main issues with the financial support provided under the New Veterans Charter:
First, the insufficiency of the economic financial support provided after the age of 65 to at risk totally and permanently incapacitated Veterans;
Second, the drop in income for Veterans who are transitioning from a military to a civilian career because the Earnings Loss Benefit only pays 75 percent of pre-release salary;
Third, the accessibility to the Permanent Impairment Allowance and the Permanent Impairment Allowance Supplement is a problem for many severely impaired Veterans;
Fourth, the unfair practice of providing a reduced Earnings Loss Benefit to part-time reservists who suffer an injury or illness related to service;
And the fifth financial shortcoming is the non-economic benefit designed to compensate for pain and suffering – the disability award. This benefit is supposed to have kept pace with civilian court awards for pain and suffering, but it has not.
The core objective of the New Veterans Charter is to successfully re-integrate injured or ill service personnel into civilian life so that they can achieve what every Canadian strives for: a good job, financial independence, and a reasonable quality of personal and family life. If their medical condition does not allow them to return to work, then these Veterans need proper support so that they can live their lives with dignity and financial security.
The shortcomings that have been presented to Government through my reports and by the many witnesses that have appeared before the House of Commons and Senate Committees on Veterans Affairs over the past several months are impediments to achieving the Charter’s core objective. With a few focused improvements, the New Veterans Charter could become a system of benefits and programs that has a tangible and positive impact on all Veterans and their families – a system that Veterans can be proud of rather than the object of unabated discontent.
The reality is that most of the 20 recommendations I have made on how to improve the New Veterans Charter require little or no funding. Funding will be required, however, to address the deficiencies in financial support programs, but I submit to you that if we do not deal with these challenges now, we will have to deal with the human cost later.
In closing, I have a simple vision of what the New Veterans Charter should be: a well integrated system of programs that provides the transitioning Veteran with optimism for the future and for the new opportunities available to him or her. In other words, Veterans should be able to look forward to the future with enthusiasm and with a sense of purpose rather than feeling overwhelmed with the present and longing for a past that is no longer possible. To create this optimism for all Veterans, substantive improvements need to be made to the New Veterans Charter and in particular to financial support programs.
Each passing day that the problems I have identified with the New Veterans Charter are not remedied means another day that Veterans and families struggle with the stresses of transitioning from military to civilian life. Government has the opportunity to make a real difference for Veterans and families by resolving long-standing problems with the New Veterans Charter.