Veterans Affairs Committee on April 20th, 2009

[Ben Lobb, Conservative, Huron—Bruce, ON]

No. I'll generalize here, but this would be for veterans from World War II who are quite elderly but still live at home and want to maintain a degree of independence. Our government provides them with a certain amount of funding dollars to help with their lawn maintenance and other things around the house and that type of thing. Do you have anything similar?

[BGen Sanzio Bonotto]

Yes, we have it for the military. You're saying it's something you give to the military because they have been in service?

[Ben Lobb, Conservative, Huron—Bruce, ON]

Well, yes, it's for veterans who are probably in their eighties. It's for World War II veterans who choose to stay at home but need a little assistance. Do you have a similar program?

[BGen Sanzio Bonotto]

I don't think so. I've tried to remember, but I don't know. Sorry.

[Ben Lobb, Conservative, Huron—Bruce, ON]

There's another thing that I had a question about. When you're classifying a percentage of disability or injury, if a veteran or a person who is serving is not satisfied, is there an appeal process?

[BGen Sanzio Bonotto]

Yes, if the people are not satisfied with the category they're in, they can complain. There is another committee that looks at whether or not they are in the correct category, to see if they have to change, to go up or down. It depends. It's possible. When they receive their category the first time, people probably don't want to be in that category and want to be posted in another category.

Going through the service categories, when you are in category 8, you can stay in service, but if you go down to category 7, you probably have to leave the service. Taking that into account, sometimes when you go down through the categories you will not able to stay in the service any more, because of disablement or something like that. People sometimes prefer to accept their category, stay there, and then ask for a job in the service, but if you go down in the categories, you'll probably have to leave the service.

But you can apply to have your category changed if you don't agree with it.

[Ben Lobb, Conservative, Huron—Bruce, ON]

As well, there are three classifications of pensioners, as I understand from your presentation: past, current, and future. Besides the change in conscription, was there any motivation behind the change? Was it financial or political?

[BGen Sanzio Bonotto]

The first time it changed, in 1991, a lot of people disagreed, because it changed a lot. We were passing from a pension calculated on the last salary to, in the future, one that would not be calculated on your average salary over your lifetime, and your pension would go down. At the beginning, people didn't agree with the change.

It affected not only the military, but also all of the compartments. The military changed a little bit later, because they had a buffer of four or five years. For the others, there was not this kind of buffer. We accepted it in the end, because after 18 years of service.... The people have about 22 years of service before they get the pension. The people didn't realize a lot of this.

Now the people who join the armed forces have the other kind of pension, so they're not thinking about this. The only thing people are thinking about is that if they don't have 18 years of service after that date, they'll probably have to buy a house with their salary. With the previous pension, they were able to pay for a house at the end of their service. This is a difference, because in 20 years, your pension will probably not be the same as the salary you gained every month, but will be half. If you earned 1,000 euros, you'll probably have a pension of 500 euros. That is the future of our pensions.

Now, every time we go to discuss pensions, we realize it's a very big amount of money the state has to give to people, because lifespans are now longer.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Lobb.

Thank you, General.

Mr. McColeman for five minutes.

[Phil McColeman, Conservative, Brant, ON]

Thank you, Mr. Chair.

Again, thank you, sir, for being here.

I want to go down the road on this so that I can understand the history of the benefits you have supplied. It seems from your presentation that this is basically private insurance that is paid into. I'll just confirm that. Which insurance company provides the benefits? Is it a private insurance company or a government-owned insurance company?

[BGen Sanzio Bonotto]

For the missions abroad, it's private insurance.

[Phil McColeman, Conservative, Brant, ON]

Was there ever a time when the Italian government actually provided those benefits and the benefits weren't purchased from a private insurance company?

[BGen Sanzio Bonotto]

For the military, yes. This kind of insurance started 10 years ago for us. Every year, an application is made so that all of the insurance companies can participate.

[Phil McColeman, Conservative, Brant, ON]

Okay. So they can compete to be the company—

[BGen Sanzio Bonotto]

Yes, they can compete, and every year, probably, they change.

[Phil McColeman, Conservative, Brant, ON]

—providing the benefits.

[BGen Sanzio Bonotto]

Yes.

[Phil McColeman, Conservative, Brant, ON]

Okay. So it's very similar to the private insurance, life insurance, or even automobile insurance that we have here in most of the country. I wanted to get that distinction straight and make sure that there wasn't a government agency backing up the amount of money being paid out. It's actually paid out by a private insurance company.

[BGen Sanzio Bonotto]

But you never hear that this insurance doesn't pay because of something happening, so--

[Phil McColeman, Conservative, Brant, ON]

They're good--

[BGen Sanzio Bonotto]

If there are a hundred or a thousand people injured--I hope not--it can happen that the insurance is not able to pay, because with $4 million to $5 million for premiums every year, I think, I don't know if they would be able to cover all the injured, but right now, they cover all the time.

[Phil McColeman, Conservative, Brant, ON]

Sure, and isn't that their job as a company providing a product? They need to be sure that they know their business in the sense that they cover the cost of doing business and make a profit to provide the benefits at the end of the day. Otherwise, there's no sense in even competing in the first place. I wanted to be very clear about that distinction.

I also have a general comment. I hope you understand what I'm going to ask here. It seems to me that the changes may have resulted from situations in which there was just too much cost in the system. Is that correct? In regard to some of the thresholds to qualify, when we got to that section, the 40 years of service as a threshold to qualify seemed very high to me. Now, at a certain point, might that have been lower? Was this ever lower than 40 years to qualify for it?

[BGen Sanzio Bonotto]

Was it lower than 40 years?

[Phil McColeman, Conservative, Brant, ON]

Yes. Was it 40 years of service for the maximum benefits?

[BGen Sanzio Bonotto]

No, I think that—