Veterans Affairs Committee on Nov. 5th, 2009

[Brad White]

Yes, if I could, please, I'd like to also add in a few comments about Mr. Mallette.

I commend you for bringing the position of your people here today. In 1966, when the changes to CPP were made, the Canadian Forces members and members of the RCMP didn't have representation to put their point forward about how the changes were going to affect them. So it's interesting to see today that you have taken the time to come here and do that, and I commend you for it.

[The Chair, Conservative, David Sweet]

Thank you, Mr. White.

Now on to Mr. Stoffer for five minutes.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Thank you, Mr. Chairman.

Gentlemen, to all four of you, thank you very much for coming.

I'd like to also recognize a tremendous veteran we have in our country, Mr. Shawn Bray, who is in the room. He's done a fantastic job in defending the modern-day veterans on all types of issues that we've seen before.

First of all, Monsieur Mallette, merci beaucoup for your presentation. Thank you so much.

In your presentation you talked about the 2.33%, which was very similar to what the firefighters were asking for in terms of allowing them to retire early. So I'd like you to elaborate just a bit on that when you get a chance.

Mr. White, I say this to you, sir. We had a respected member of Parliament, a former colonel, I believe, in the air force, Mr. Laurie Hawn, the Parliamentary Secretary to the Minister of National Defence, appear before the committee, and in his presentation he said the following:

Many people take CPP as early as age 60 and take the .5% reduction per month before 65. ... If they take CPP at 60, what the CF and RCMP members are doing for that five years is doubledipping their CPP...

I'd just like to know this. Have you ever heard, in all the years you've worked at the Royal Canadian Legion, in your command, the term “double-dipping” your pension at age 60?

I'd remind the committee and you that every federal and provincial public servant who retires at age 60 can elect to take their CPP early. Everyone can. But you do take a reduction from that CPP benefit because you're taking it earlier than 65.

Mr. O’Handley, my question is for you, sir, and for Monsieur Labelle. Sir, you said you had to pay back $11,000 to the RCMP annuity group. Can you please tell us what Great-West Life has asked from you for the money back, because you said you got a $16,000 lump sum, correct? If I'm correct, you said $11,000 of that $16,000 had to go back to the RCMP, right? Have you notified Great-West Life, because my understanding is that for those two years that Great-West Life paid you for that 11%, they're going to insist and demand that money back. Have you informed them of that yet? Are you aware that's happening? I'd like your comments on this.

Mr. Labelle, it's the same for you, sir. As you know, many people have been arguing this point for quite some time in terms of the fairness and the issue of it, but the reality is that there had to have been something somewhere that was written that all these things would be happening to you. And as an officer who advised other people, what can you say to them in terms of whatever fine print it was in or what discussions you had in terms of the explanation of the benefit reduction--or as it is popularly known, the clawback-- in this particular regard?

Let's start with Mr. Mallette, please. And be very brief, because I only have five minutes, sir.

[Pierre Mallette]

Okay.

You have to understand that since 2005, the Income Tax Act has allowed us to ask for up to 2.33% per year of service. That act now covers corrections officers. Since 2002, the union has been trying to raise the annual percentage and have the pension plan changed.

When that act was amended, in 2005, we said to ourselves that this was excellent news and we would finally be able to make progress. Because we are unionized, we thought we could negotiate and be able to get that provision for our members. Sometimes, being unionized does not automatically open all the doors.

For example, the 2.33% would allow our people, at age 50, after 25 years' service, to get a rate of about 70%. As I said earlier, their situation would be truly fair as compared to the situation of public servants who work for 35 years. It is a recognized fact that this occupation is complicated and difficult and our people have to be allowed to retire earlier. The 2.33% would make that possible. It would represent 4% of total earnings. We are there.

The change to the act allows us to do that, but unfortunately, no one is opening the door for us so we can sit down together and find a solution to this problem. That is what we are asking for. We are conducting media campaigns and talking with members of Parliament. We want a chance to resolve what we have been granted under this change, but that we have not been given in actual fact.

[Peter Stoffer, NDP, Sackville—Eastern Shore, NS]

Mr. White.

[Brad White]

Mr. Stoffer, thank you for the question on double-dipping. I read Mr. Hawn's remarks that he made this week. I have never heard double-dipping referred to as basically receiving a pension as well as CPP at the same time. In my familiarity with double-dipping, it means that you were receiving a salary and possibly a pension at the same time, but not CPP. So that's a very quick answer to your question.

[Roddie O'Handley]

To answer your question, I haven't had time to contact Great-West Life because I am in the process of doing it. As far as I got was Canada disability, and my next step was to go to Great-West Life to see what we could get out of Great-West Life. So I can't answer your question about what I owe Great-West Life out of the amount of money I got.

But I can say this for a fact. I have a very good friend by the name of Frank O'Brien. We worked together hand in hand in the RCMP. We worked for years together. He retired in a similar situation as I retired to. I can read to you about what happened to him. This man has a heart condition, and I don't know why he's not in the graveyard over what's happening to him, because he was at my house on Friday night and when he talks about this he gets very excited.

Here's the thing that happened to him.

[The Chair, Conservative, David Sweet]

Mr. O'Handley, how long is this?

[Roddie O'Handley]

It's just one paragraph and that's it.

[The Chair, Conservative, David Sweet]

We're well over Mr. Stoffer's time. We'll have to leave that to another point. I always allow some latitude for answers.

Mr. Labelle, if you have a brief answer, I'll allow you to put that in even though we're over Mr. Stoffer's time.

[John Labelle]

Thank you, Mr. Chair. Thank you, Mr. Stoffer.

I will make my comments very brief. As I've already stated, when we're speaking of the gentlemen like Major-General Lewis MacKenzie, Colonel Don Ethell, a large number of our senior officers, 112 of them to be exact, have sent me letters and e-mails telling me they were not aware that their pension was going to be reduced at age 65 until they became 65 themselves. All of these supporters have also told us the same thing. As the financial counsellor of the Maritime Command, I was not aware, and therefore I was lecturing three to five times a week to all rank levels, including the admiral.

Thank you, sir.

[The Chair, Conservative, David Sweet]

Thank you, Mr. Labelle.

Now on to Mr. Kerr for seven minutes.

[Greg Kerr, Conservative, West Nova, NS]

Thank you very much.

Thank you very much, gentlemen, for coming this morning for what is a very difficult topic. I think we all agree with that. I'm going to give Mr. O'Handley a chance in a minute to carry on with that topic, but I do want to go to Mr. Mallette first.

I don't want to go back over the issues that you've already raised, but I do want to know, first of all, in the nature of the business you do, would you also then say this would be extended to people like border guards, municipal police forces, and other types of services where you have to carry a sidearm and face difficult situations? Do you see this extending into a whole number of other areas as well?

[Pierre Mallette]

When they changed the law to 2.33% in 2005, it was not just for correctional officers. These other groups were there too. They had the chance to get the same thing as we got. When you compare the work that a correctional officer is doing inside the institution, we're sitting with the other group, as you're saying; we're trying to compare with them. Of course, there are a lot of things that are the same for them.

When they changed that law in 2005, it was not just for us, it was for the other group, but nobody had it. I don't know why we changed that if we don't give it to people.

[Greg Kerr, Conservative, West Nova, NS]

So that's a general category. Thank you for that.

Mr. O'Handley, you can do your paragraph as well, but what I really want to follow through on is that a lot of this has to do with information in terms of who knew what and when it happened, and so on, and I understand that.

You're giving your personal view and you're going to talk about a friend of yours. How widespread do you know this to be in terms of the disability pension and the reduction, not just from Great-West Life, but I assume this is a problem that may happen elsewhere; and what explanations have you been given? In other words, what are the official comments on that?

Secondly, when it went to the other adjustment, you say the RCMP then took it back out of the adjustment fund. What official explanation were you given on that? I'm trying to line up the ducks so we see what was done, where, and why.

If you want to get the paragraph in that Mr. Stoffer is asking for, that's fine, but I would like you to answer some of the other questions as well, please.

[Roddie O'Handley]

I would appreciate getting the paragraph in, because I think it's important and I'm going to show you the way he was treated.

This is from Frank O'Brien, who lives in Moncton, New Brunswick:

Great-West Life pressured me into applying for a Canada disability pension. At no time was I advised of the repercussions. The back-time cheque received from the Canada Pension Plan was $17,318.38, and I had to forward Great-West Life $17,611.68 of that money. On top of that, I was advised that from this amount I owed the RCMP $14,711.69. To make matters worse, I then had my RCMP pension clawed back when it should have been clawed back at 65.

So he got a cheque for $17,318.38 from CPP, and then he ended up forwarding $17,611.68—which was more than he got, because I assume that they wanted interest or whatever, I don't know—to Great-West Life. Then the RCMP came along, and from the same $17,318 he got from CPP, they wanted $14,711.69. So out of the $17,000, he paid around $30,000, or whatever it adds up to.

Because he didn't give it to them, they took it back. It's my understanding that they reduced his pension to get the money back and he's still paying. Is that fair?

[Greg Kerr, Conservative, West Nova, NS]

I want to go from that situation back to your own, though.

I understand, and I wanted you to get that paragraph in.

[Roddie O'Handley]

So you're asking me now the second question: why, in my mind, am I--

[Greg Kerr, Conservative, West Nova, NS]

No. I'm trying to get to the official information you received explaining, I assume, in detail, from the RCMP first, after the Great-West, why it would not accept the second round of funding you got from the adjustment fund.

[Roddie O'Handley]

The reason the RCMP gave me as to why it was being deducted was that the RCMP Superannuation Act allowed them to do that.

[Greg Kerr, Conservative, West Nova, NS]

It allows them to do that.

[Roddie O'Handley]

It says here:

Therefore, the pension you have currently received from the RCMP Superannuation Act must be reduced by the CPP offset established under the RCMP Superannuation Act.

I assume that's why they do it.

I'm going to be honest with you. I don't know all the logistics behind it. I'm not a lawyer. I was expecting to get all my money, and here I am, getting a reduction. I'm reading into it that it's because of the RCMP Superannuation Act. That's as honest as I can be, because I'm no lawyer.

[Greg Kerr, Conservative, West Nova, NS]

No, and I'm not trying to get you--

[Roddie O'Handley]

No, but I'm just trying to be honest.

[Greg Kerr, Conservative, West Nova, NS]

I'm trying to get it on the record. The fact is that Great-West was treated separately from the adjustment fund you got later. Great-West was accepted by the super fund and you're saying the Canadian disability was not.