Veterans Affairs Committee on May 26th, 2015

[Frank Valeriote, Liberal, Guelph, ON]

Thank you, Mr. Parent.

We'll now go to Mr. Forbes, for 10 minutes.

[Brian Forbes, Chairman, National Council of Veteran Associations in Canada]

Thank you, Mr. Chair.

NCVA welcomes this opportunity to speak to this committee this morning on Bill C-59, with particular reference to that portion of the legislation dealing with the new Veterans Charter reform.

I first wish to state that it has become readily apparent over recent months that there have been a number of significant developments positively impacting on the operation of Veterans Affairs Canada and the department's relationship with the veterans community. We would be remiss if we did not commend the minister, Erin O'Toole, and the deputy, Walt Natynczyk, on their proactive engagement in the overall reform of the charter and the enhancement of the administrative culture within VAC.

With specific reference to charter reform, it is fair to say that significant momentum and substantial traction have been developed through the various recommendations brought down by the minister, culminating in the establishment of the current statutory amendments before Parliament, which clearly are the government's attempt to respond to their proposals made by this standing committee, the Veterans Ombudsman, the Veterans Consultation Group, the New Veterans Charter Advisory Group, and our NCVA organizations.

Unfortunately, many of the minister's announcements and proposed legislative amendments reflect, in our judgment, half measures and are clearly not fully responsive to the comprehensive recommendations made by this committee and the aforementioned multiple advisory groups. After years, however, of what I have described as unacceptable inertia within VAC, there are indeed solid indications that the first phase of positive, incremental change is taking place. It remains our mandate, and I might respectfully suggest the responsibility of this committee and veteran stakeholders, to maintain pressure on the government to complete this vital initiative in addressing the outstanding inequities which still remain in the charter.

Mr. Chair, I would now like to make a number of general comments on the bill and the impact it will have on the new Veterans Charter.

First, the clear focus on seriously disabled veterans is commendable as it has consistently been the position of NCVA that the highest priority of the veterans community and the government must be seriously injured veterans.

Second, it is self-evident upon a review of the substantive provisions of the statutory amendments that the devil will be in the details as there are a number of references in the legislation to regulations and policy guidelines that have yet to be formulated to support the general provisions of the act. It is my opinion that until these regulations are finalized, it will not be possible to evaluate the precise eligibility criteria for the newly proposed major benefits and the “factors to be considered”, which are often mentioned in the bill, in the administration of the new law. It will be incumbent on veteran stakeholders and indeed this standing committee to monitor closely the draft regulations and policy guidelines to ensure that the substantive provisions of the act are not diluted or unduly restricted.

Third, it is also readily apparent that budgetary constraints still exist. It is our opinion, upon a review of the minister's announcements and the statutory amendments, that the proposals have been structured to fit into the budgetary envelope, resulting in proposed benefits that are targeted to specific cohort veterans rather than the veteran population at large. Unfortunately, in our view, the government fixation with balancing the budget in this election year remains a restraint on the complete new Veterans Charter reform at this time.

Fourth, as I stated to the minister through recent correspondence and through my presentation to the veterans summit, much more needs to be done to rectify the voids that have been readily identified in the charter. The present state of development cannot be considered a total fait accompli, but merely a significant first stage of remedial legislation.

Mr. Chair, I know we're under certain time constraints and my brief is fairly lengthy. I've made it available to members of the committee, but I'd like to highlight some of my concerns with regard to the bill and those areas where there are still gaps and inequities in the charter which have yet to be addressed in this legislation.

First, the earnings loss benefit must be elevated from 75% of former military income to 100% in accordance with the long-standing and consistent recommendations of the New Veterans Charter Advisory Group, the Veterans Consultation Group, and NCVA—or at least to 90%, as proposed by my friend, the Veterans Ombudsman. The current reduction of 25% in income is unacceptable, particularly given that this loss of essential revenue is imposed when veterans and their families face a period of rehabilitation as they attempt to re-establish themselves in Canadian society.

This is particularly material to those who are permanently incapacitated. In this regard, the career probable-earnings approach identified by this committee should be implemented to ensure the true impact of the projected career income loss is recognized. This proposal can be implemented by further reform of the PIA or the PIAS, or alternatively by a separate evaluation based on the mechanisms used by the Canadian civil courts to ascertain future loss of income for severely injured plaintiffs

Second, the SISIP long-term disability policy needs to be eliminated from veterans legislation and be applied only to non-service related disability.

Beyond the unnecessary duplication of the programs—SISIP and ELB—the compensation of veterans and their dependants should not be a function of the insurance industry, whose mandate in many situations is to minimize exposure of insurers' policies when applied to injured or disabled individuals. I speak more of that in the paper, and I'll leave that to your reading at a separate time.

Third, disability awards commensurate with civil court general damages should be facilitated by VAC.

It is to be noted that in lieu of implementing this long-standing recommendation, the minister has opted to propose a new critical injury benefit in the amount of $70,000. This CIB is limited to the specific circumstances of a transitionally incapacitated veteran and to high-end disability award recipients. It is noteworthy in this regard that the CIB is fraught with definitional issues as to who is eligible for this benefit and what factors are to be considered by adjudicators in determining the scope and extent of this new provision. Although we support the establishment of the innovative CIB in recognition of the plight that seriously disabled veterans confront, the choice of VAC to compensate only this particular class of veterans, as opposed to incrementally increasing all pensions in the disability award system, is of concern. I might add that this recommendation has been consistently brought forward over the last six or seven years not only by this committee, but by all of the other advisory groups that have looked at the charter.

Fourth, improved access to permanent impairment allowance and entitlement to higher-grade levels of the allowance needs further evaluation. It will be recalled that the Veterans Ombudsman, Mr. Parent, in his empirical study of the charter identified that 50% of seriously disabled veterans were not receiving the PIA, and consequently the PIAS, and that 90% of these veterans receiving the award were only obtaining grade three, the lowest grade. The minister's proposal to widen the regulatory definition of PIA eligibility is commendable, but once again does not fully satisfy all aspects of the reform of this important allowance. This is particularly so for those seriously disabled veterans who fail to satisfy the criteria for PIA, but it is also of great significance when one considers that the amount of the PIA is a major element of the new retirement income security benefit, as was pointed out by Mr. Butler this morning.

We continue to strongly feel that our proposal to the standing committee in this regard is the best approach to improving this access to PIA. That is, once a veteran is deemed to be permanently incapacitated, the disability award received by such a veteran should be the major determinant in assessing his or her grade level of PIA. If you're over 78% disability award, you should be entitled to a grade one PIA. Between 48% and 78%, you should be at grade two. It's simple, straightforward, and triggered by the disability award.

Fifth, the family caregiver relief benefit requires further re-evaluation as it fails to comprehensively provide adequate financial support for the families of seriously disabled veterans where significant needs of attendants must be provided by a caregiver. This benefit, as brought forward by the minister, is commendable insofar as it goes, as a targeted support to allow caregivers appropriate respite or relief, but in my judgment, it represents only one element of the overall concerns confronting the caregivers of seriously disabled veterans in need of attendants. Such families are also facing, in many cases, a significant diminishment in income due to the fact that the caregiver spouse has been forced to give up his or her employment, and when coupled with the veteran's 25% loss of income, through SISIP or ELB, it often results in a financial crisis in the overall family budget.

I'll just be a couple of minutes, Mr. Chair. Thank you.

[The Chair, Conservative, Royal Galipeau]

Your 10 minutes are up. I thank you very much, Mr. Forbes.

Mr. Chicoine.

[Sylvain Chicoine, NDP, Châteauguay—Saint-Constant, QC]

Thank you, Mr. Chair.

I'd also like to thank the witnesses for sharing their observations in their opening remarks. This is just the first step in improving the new veterans charter.

A lot of improvements still need to be made, improvements that appear in the ombudsman's reports over the past few years, as well as in the committee's June 2014 report. You called the legislation a step in the right direction, but I tend to view it as a half-measure as far as the three new benefits are concerned.

For instance, the retirement income security benefit is better than nothing, yes, but it only provides 70%. Mr. Forbes said that he was actually in favour of a formula that would provide 100%. Veterans should receive 100% of the benefit amount throughout their retirement years. Mr. Parent, I believe that was also one of your recommendations.

I'd like to hear your thoughts on each of the benefits, beginning with the retirement income security benefit. As the legislation is currently worded, does the benefit guarantee veterans financial security in their retirement years, post-65?

[Guy Parent]

Thank you for the question.

Mr. Chair, I think there's been a bit of confusion. The percentage referred to didn't concern the retirement income security benefit post-65 but, rather, the earnings loss benefit, which Mr. Forbes said should be raised to 100% and the Office of the Veterans Ombudsman said should be provided at 90%.

I explained to the committee that what was important, in our view, was ensuring that a person participating in vocational rehabilitation receive the same level of income support. We would like to see the individual keep at least the same amount of money in their pocket. We are proposing 90% because people wouldn't have to pay into their pension fund, retirement fund and so forth.

As for financial security after the age of 65, I agree with you, it's a step in the right direction. It's very hard to take a position on that, however, because the regulations haven't been published yet. Once we know more about the regulations, we'll have a clearer idea as to the impact. Nevertheless, it does satisfy a need that both our office and the committee identified given that the new veterans charter didn't provide for any benefit after the age of 65. This way, at least veterans will continue to receive 70% of the amount they were getting from the department.

[Sylvain Chicoine, NDP, Châteauguay—Saint-Constant, QC]

Do you think the formula provided for is sufficient? As you mentioned, the person already loses income when they are injured. The allowance is 75%, but my understanding is that it will actually be between 70% and 75%, and that means 50% of the amount the member was receiving before the injury. Injured members are already receiving less income support, and that amount will drop even further post-retirement if they haven't made pension contributions for at least 10 years. In your view, is a benefit that represents 70% to 75% of the amount they were previously receiving sufficient for veterans to have a decent standard of living in their retirement years?

[Guy Parent]

Every veteran's personal circumstances are different. It will all depend on the other income streams that the veteran and his or her family have at the time. And that makes it very tough to have a comprehensive solution that will work for all veterans. I should also point out, Mr. Chair, that the word “sufficient” isn't in the ombudsman's vocabulary. There will never be a portion that is sufficient for our veterans. We are constantly working to meet the demand.

[Sylvain Chicoine, NDP, Châteauguay—Saint-Constant, QC]

Mr. Forbes, what do you think?

[Brian Forbes]

Yes, thank you for the question. Mr. Parent and I respectfully disagree on this one. We've talked about this for many months.

We would like to see, as the member is suggesting, that when you're dealing with totally and permanently incapacitated veterans at the age of 65, you continue the earnings loss benefit at 100%. What is concerning is the example you've raised, Mr. Chicoine. If the veteran does not receive any PIA, he already has ELB or SISIP at 75% of his military income, so you're really talking about 70% of 75%, which is 50%. What is crystal clear is that if this new provision, this RISB, is going to work, there's going to have to be an enhancement of the ELB and an enhancement of the PIA, so that the numbers will make more sense at the age of 65. It is our view that the RISB is a half measure because it basically talks in terms of a percentage of a percentage.

One of the things that we have felt strongly and which Guy and I have talked about many times is, should you really apply what is the private and public sector model of 70%, which public servants are certainly getting? We're talking about seriously disabled veterans. Their circumstances don't change at the age of 65.

[The Chair, Conservative, Royal Galipeau]

Mr. Lemieux, it is your turn.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Thank you, Chair. To our witnesses, thank you for being here.

Actually, it's an interesting discussion. Let me just ask a question about that.

I think the ombudsman made a good point that a lot of these circumstances are very personal, meaning they are unique to the individual who is being considered for benefits. For example, sometimes it's easy to think that the ELB, which is at 70%, should be at 80%, should be at 90%, should be at 100%, but there are other benefits too that a veteran may have access to. It's very individual.

For example, if someone is a moderately to seriously injured veteran, is the disability award being taken into consideration there? That can be quite a large lump sum payment up to $300,000. In addition to that, there's the SISIP payment for dismemberment. If a member lost an arm, lost an eye, lost two eyes, lost an arm and a leg, there could be a significant lump sum payment that is in addition to any type of ELB they would receive.

The third thing I would mention of course is the military pension. It is true some soldiers are young and may not be in the pensionable window, but there are others who are and would receive their military pension.

I think there are a lot of factors. If I may, let me ask the ombudsman about that.

When you're advocating a position for the ELB, for example, are you taking into consideration these other benefits to which a veteran may be eligible?

[Guy Parent]

Thank you for your question and comments.

Mr. Chair, I would like to point out that when we published the new Veterans Charter review, we actually made a point of not mixing up the pain and suffering amounts with the income replacement amount. There's a big difference between the two. In fact, you could say that under the new legislation, the critical incident benefit is a pain and suffering payment, not a replacement for income. If you mix the two, then it is very hard for young veterans to understand how beneficial the new Veterans Charter is compared to the old Pension Act.

In terms of the earnings loss benefit, we have always urged the government to up the benefit to, as I say, 90%, or no change in income. Obviously, the earnings loss benefit will change, as you say, depending on the other income received by the veteran. At age 65 a veteran may receive very little ELB because of his pension and other. The ELB is based on the pre-release salary, so at 65, a person might be getting very little earnings loss, and if they are getting PIA and PIAS, then they are benefits for life. They don't stop at 65.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

If I may, I would bring it to the legislation and what's in this legislation.

I really appreciated your remarks, and I particularly appreciated your fairness principles of adequacy, sufficiency, and accessibility, and how you looked at what's in the legislation. You defined what's in the legislation through your fairness principles.

I don't think anybody feels the work is now done and that's that. I think these are just important steps. They are milestone steps in terms of moving forward.

I would ask the ombudsman from that perspective, is your recommendation to committee members to actually pass this legislation so these new benefits can be implemented?

[Guy Parent]

As I said in my remarks, yes, it is. In fact, again, it may be described as a half measure by some, and it might be described as not sufficient, but it's a step in the right direction and we can't take that step unless the legislation is passed.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Great. Thank you.

Let me ask Mr. Forbes the same question, because I think this is a critical question. I think depending on who you speak to and what their emphasis is in terms of delivering benefits, there's much more that can be done in any one, two, three, or uncountable areas. However, this is a very defined bill, and it has very concrete measures in it, concrete measures in terms of financial benefits that will be delivered to veterans.

I understand you want more. I understand from your remarks that you're not happy with what's in there, but is your advice to committee members to support this legislation so it passes into law and will actually deliver these benefits to veterans?

[Brian Forbes]

Let me be very clear, Mr. Chair. In my remarks, I indicated that there are positive elements to these recommendations and in the bill.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Well, what would your recommendation be?

[Brian Forbes]

What my conclusion would have been.... I thought I'd suggest it, Mr. Chair, if you'd allow me to get to that conclusion.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Absolutely.

[Brian Forbes]

The conclusion that we really wanted to talk to you about is that there is work to be done. There is a lot to be done in the charter. There are inequities in the charter. I think we all agree.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Right.

[Brian Forbes]

We'd like to urge this committee to actually obtain a formal commitment from the minister that he will look at these changes in the timeframe of the future that he can define, or that this committee can define, as a follow-up to the passage of this bill.

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

Sure, but we have to vote on this legislation.

[Brian Forbes]

Yes, but I think it's important—

[Pierre Lemieux, Conservative, Glengarry—Prescott—Russell, ON]

What would be your recommendation?