Madam Gallant, before I say that, I want to thank you for the work you have done advocating on behalf of members, their families, and veterans, particularly in the Petawawa Base, where I know you represent them well.
This was a historic settlement, as you know. This was a case that was before the courts. It affected our military personnel, both serving and some retired members. This has been a priority for our government. After the Federal Court ruled in May 2012 on the Manuge class action lawsuit, we took immediate action. I announced we would not be appealing that decision.
We then worked to end the Pension Act offset, which was at the root of this issue. We followed up with the appointment of a federal representative who negotiated the settlement with class action counsel.
The $725.7 million you refer to has been requested to support the implementation of the settlement in principle—that is, the action itself. That amount of money includes retroactive payments that in fact go back to 1976. It also includes interest on the payments.
It also includes the additional amount to ease the income tax implication for retroactive payments, because, as you know, under the income tax rules there could be significant penalties.
As well, this sum includes a $10 million scholarship fund for class members and their families. I should note that in accordance with the terms of the agreement, it sets aside funds to cover future claim payments should they arise.
The decision, as you would know, is being finalized by the court. It's there for review. There is an issue of payment to legal representation that has been somewhat contentious. We've filed our objections as to the percentage the lawyers were seeking in this case.
It's a landmark case. Mr. Manuge himself and many of the claimants have expressed certainly their relief that this court action is now settled favourably, and I think it has been seen quite widely as a generous settlement.