Good afternoon, Mr. Chair and members of the committee.
Thank you for inviting me to appear before this committee to share with you my views on division 1 of part 6 of Bill C-31, entitled Payments—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, such as the earnings loss benefit, Canadian Forces income supplement, and war veterans allowance. The one-time payment for those 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.
Numerous veterans have called my office to complain that the short periods of retroactivity are not fair. They argue that the Federal Court settlement under the Manuge v. Canada case provides retroactivity back to 1976 for the Canadian Forces service income security insurance plan, known as SISIP. Consequently, they believe the retroactivity for the affected Veterans Affairs Canada programs should be provided to the date the programs came into force.
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 that 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.
I do not believe that this is a matter of fairness. The reality is that the Federal Court decision did not specifically compel the government to change the way it offset the disability pension from Veterans Affairs Canada benefits. But the government made the change anyway. There was also no obligation for the 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 and their families 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 other issues in relation to the new Veterans Charter. 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 age 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, as the earnings loss benefit pays only 75% of their pre-release salary; third, the accessibility to the permanent impairment allowance and the permanent impairment allowance supplement, which 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 fifth, 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 shortcomings that have been presented to government through my reports and by the many witnesses who 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.