If I speak too loudly, simply nudge me and I'll try to move back from the microphone. Thank you.
Mr. David Sweet, chairman of the board, members of the committee, ladies and gentlemen...Bill C-201, An Act to amend the Canadian Forces Superannuation Act and the Royal Canadian Mounted Police Superannuation Act (deletion of deduction from annuity). On behalf of Mr. Roger Boutin, Mel Pittman, and numerous committees across Canada, I wish to thank you for the opportunity to speak to the veterans affairs committee regarding member of Parliament Mr. Peter Stoffer's Bill C-201.
The purpose of this initiative is to convince the Prime Minister of Canada to take action to terminate the benefit reduction formula that has been applied to our military and RCMP veterans' annuity when they attain age 65, or sooner if they become disabled. The Government of Canada must right a wrong by amending the Canadian Forces Superannuation Act and the RCMP Superannuation Act of a miscalculation in justice and fairness that now affects our retired veterans and their families during their golden years.
The 2006-07 annual pension report indicated that there were 84,728 military pensioners and 12,331 RCMP pensioners. The total cost for the Canadian Forces veterans' pension benefits was $2.2 billion and the cost of the RCMP pensioners' benefits was $451 million. It is estimated that the termination of the CPP benefit reduction program may affect 50,000 pensioned veterans.
You are aware that the Canada Pension Plan was introduced in 1965-66. Its intention was to provide another source for an income security program, supplementing old age security. Military and RCMP veterans maintain that in 1965-66 the Government of Canada, deliberately or otherwise, imposed on military and RCMP personnel a gross injustice and unfairness by merging rather than stacking their pension contributions and benefits and not providing any options to them.
Canadian Forces superannuation facts. On January 1, 1966, the Canadian Forces employee contribution rate was reduced from 9.3% to 7.5%. Hence, a “so-called” reduced annuity contribution to our Canadian Forces superannuation has accumulated a military annuity surplus of over $20 billion. It clearly indicates that our contributions to the Canadian Forces superannuation are sufficient to pay for our benefits without a reduction clause.
Canada Pension Plan facts. With regard to the CPP, the employee and the employer each paid half of the required contributions. In 1966 the government-levied rate of contribution for military personnel was 1.8% of basic earnings. Over the years the rate substantially increased to 4.95%. Military and RCMP personnel have always made the required maximum contribution to the plan. Recently the president and chief executive officer of the Canada Pension Plan Investment Board advised that the CPP fund is financially healthy, with a surplus of $120 billion.
It is a known fact that veterans were dealt with in a negligent fashion. In those past years senior military officers were not appointed an assistant deputy minister to represent them. Veterans were not properly briefed on the pitfalls associated with the merging of their contributions. In short, democracy did not occur. Veterans were not given any options. They always made the required maximum contributions. Veterans' contributions were listed separately on their pay guides, therefore giving them a false sense of financial security.
The words “bridge benefits” are not listed in the manual A-FN-109-001/ID-001, and furthermore the manual was never made available to serving personnel. The bridge benefit term was never heard of prior to the establishment of our campaign of pension justice and fairness. When pensioners are age 73, the government has recovered all of its funds and yet continues to collect a 30% gratuity/penalty for the rest of their lives.
Veterans are getting “100% of what they paid for”. Well, they are not getting what they paid for or their pension plan would not have accumulated a $20 billion surplus. With all due respect, veterans and their families have given far more of themselves to the security of our country than any other segment of the population. Therefore, in their golden years, they deserve to be treated with fairness, justice, and dignity. Military/RCMP veterans are a distinct and different government provider, and they have encountered a varying number of issues on a regular basis.
What financial value can we associate to loss of spousal income opportunity, therefore loss of spousal CPP benefits; loss of overtime revenues with the loss of the member’s second income opportunity; and loss of ability to purchase a home and be mortgage-free during a career? Veterans are a distinct government provider. They have served far abroad on numerous 16-hour days of operational requirements, 24/7. Veterans have often faced dangerous conditions—health hazards, and extended family separation with elevated levels of stress—and Canadian Forces/RCMP personnel were prepared to give the ultimate sacrifice to our country.
On depletion of CFSA surplus funds, the Government of Canada has withdrawn a $16.5 billion surplus from the military annuity funds to pay down the national debt. In 2003-04, reports indicate that a further $630 million surplus was also retired from our pension account. The 2004-05 pension report indicates that no funds were withdrawn from the account and that there was a surplus of $1.099 billion recorded in that year. Surplus pension funds have accumulated and were sufficient to pay for the termination of the CPP benefit reduction formula.
Why are pensioners' indexing revenues reduced at age 65? Why are disabled veterans' pensions reduced? Why reduce disabled veterans' pensions indexing revenues? Why establish the CPP plan if it benefits no one?
With respect to suggested solutions—and I'm sure they are not the only ones—to solve the pension benefit reduction issue that affects over 50,000 veterans at age 65, we suggest the following. One, stop depleting the surpluses in our pension account. Two, to stabilize the depleted funds in our pension account, transfer 15% of serving personnel contributions from the employment insurance account to the pension account. We receive no benefits from the employment insurance account. Three, eliminate the pension reduction formula to military/RCMP veterans' annuity when they attain age 65, or sooner if they become disabled. And four, retroactive payments are not requested.
To endorse the campaign, we have received very positive comments of support from our former senior officers. They include Major-General Lewis MacKenzie, the highest decorated officer of the Canadian Forces; Colonel Don Ethell, the highest decorated peacekeeping officer of the Canadian Forces; Commodore David Cogdon; RCMP Deputy Commissioner Larry R. Proke; Mr. Bill Gidley, executive director, RCMP Veterans Association; Chief Warrant Officer John Marr, former Canadian Forces chief warrant officer; Lieutenant Joe Fillion, former Maritime Command chief petty officer; and Chief Petty Officer first class Don Brown, former Maritime Command chief petty officer. A great number of senior officers have clearly supported the initiative that military and RCMP veterans have been mistreated, and the situation needs to be rectified.
This worthwhile initiative continues to grow. Over 112,500 supporters have pronounced their support. The Royal Canadian Legion, with approximately 500,000 members; the Army, Navy, and Air Force Veterans in Canada, with 20,000 members; and the Air Force Association of Canada, with 12,000 members, adopted resolutions at their annual general meetings in 2006 in full support of the initiative.
The late Captain Ed Halayko, national chairman of the Armed Forces Pensioners'/Annuitants' Association of Canada, supported our initiative, and the new national chairman of the AFP-AAC, Tony Huntley, supports our initiative.
We have received support regarding our mission from Mrs. Lillian Morgenthau, founder and president of CARP, Canada’s association for the 50-plus.
Numerous other military associations have declared their support of the objective. We have received support from veterans living in 18 countries. They include England; Mexico; Germany; CYQQ force; Florida; Warsaw, Poland; the Syrian Arab Republic; Greece; the U.K.; the U.S.A.; the Cayman Islands; Afghanistan; South Africa; Iraq; Thailand; Sarajevo, Bosnia; Italy; and Japan.
In conclusion, it is time to put the politics aside. It is time for all members of Parliament to demonstrate their recognition and appreciation in a tangible way to the men and women who have served and are currently serving our country. It is time to take action to terminate this undemocratic, unfair, and unjust treatment of veterans. Terminate this pension benefit reduction that has been imposed on them without fair and open consultation.
This misguided policy violates the principles of democracy, fairness, and justice as it affects the welfare of veterans and their families in their golden years. The committee is requested to send Bill C-201 back to the House of Commons for its third and final debate and vote. All leaders of the House are requested to allow the democratic process to take place by permitting members of Parliament to vote freely when Bill C-201 is presented to the House of Commons for its final vote.
Military and RCMP veterans have gallantly served Canada. They deserve nothing less than to spend their golden years with the pensioned financial dignity that they and their families have earned and paid for in so many different ways and that they so fairly deserve.
It has been over 40 years. Now is the time to resolve this military and RCMP veteran pension issue. This issue affects our disabled and the lower ranks of veterans the most. God bless our military and RCMP veterans, for it is their sacrifices that allow me to speak freely to you today. Let us not forget them.
It has been an honour and a privilege to serve our country, Canada, and we continue to serve today. We shall remember them.