Veterans Affairs Committee on May 20th, 2022

[The Chair, Liberal, Emmanuel Dubourg]

I call the meeting to order.

Welcome to the fifteenth meeting of the Standing Committee on Veterans Affairs.

I would also like to welcome our colleagues Ms. Kusie and Mr. Lauzon, replacing Ms. Roberts and Mr. Rogers.

Pursuant to Standing Order 108(2) and the motion adopted by the committee on February 8, 2022, the committee is meeting to continue its study of survivor pension benefits in cases of marriage after age 60.

I would like to take this opportunity to remind all participants to this meeting that screenshots or taking photos of your screen are not permitted.

If you are on the video conference, please click on the microphone icon to unmute yourself. For those in the room, your microphone will be controlled as normal by the proceedings and verification officer. When speaking, please speak slowly and clearly, and when you are not speaking, your mike should be on mute.

As a reminder, all comments by members and witnesses should be addressed through the chair.

I would now like to welcome our witnesses.

From the Canadian Institute for Military and Veteran Health Research, we have Dr. Eric Ping Hung Li, associate professor, University of British Columbia. From the Department of Veterans Affairs, we have Crystal Garrett-Baird, director general, policy and research. From the Treasury Board Secretariat, we have Nadine Labrie, senior director, pensions and benefits; and Simon Crabtree, executive director, pensions and benefits. Finally, from the the Department of National Defence, we have Brigadier-General Virginia Tattersall, director general, compensation and benefits.

You will have five minutes for your opening remarks, and we will then go into rounds of questioning. I was informed that the Treasury Board Secretariat does not have opening remarks, and they will only answer questions from the members.

We will begin with Dr. Eric Li, and then we will move on to the Department of Veterans Affairs and finally to the Department of National Defence.

I would like to invite the participants to take the floor, starting with Mr. Li.

I will signal you when you have one minute left or your time is up.

I'd like to invite Mr. Li to open his mike and to start his opening remarks for five minutes.

Please go ahead, Mr. Li.

[Dr. Eric Ping Hung Li, Associate Professor, The University of British Columbia, Canadian Institute for Military and Veteran Health Research]

Good afternoon, Mr. Chair, committee members and honourable guests. It is my honour to be here today to join the meeting.

I'm Eric Li, associate professor at the faculty of management of UBC's Okanagan campus. I would like the opportunity to share the key findings and recommendations of the qualitative study of financial well-being of military veteran survivors, funded by the Canadian Institute for Military and Veteran Health Research.

The well-being of military veteran survivors is insufficiently understood. This raises concerns regarding the inability of spouses who marry or enter into common-law relationships with the veteran after he or she turns 60 to access the superannuation benefits.

To better understand the scale of this issue, between the months of March and October 2020, we interviewed seven survivors and three veterans. Even though the participant pool is relatively small, these 10 interviews were sufficient for our research team to capture four themes related to the changes in financial well-being. These are survivors' adjustment and compromise in lifestyle, concerns about home ownership, financial stability and independence, and their views on current pension policies.

Our findings indicate that being ineligible to inherit veterans' pensions makes a very large difference to the lives of survivors. The participants who did not receive veterans' pensions had to make some drastic changes to their lifestyles. For example, one participant had to sell her townhouse after her husband died in order to reduce her expenditures, as she now has to be very careful with her expenses. Her opportunities for socialization have been limited, leading to loneliness and depression.

Some irregular and unexpected expenses—such as prescription glasses, home repairs or renovations, or car maintenance—can cause extra stress for these survivors. Many also worry about their future, as they anticipate that their health-related costs will increase as they age. Struggles are even greater for those who are not eligible for veterans' pensions. Most military spouses are unable to sustain full-time employment and have limited personal income and savings.

Based on our findings, we offer three recommendations for policy and program review. First, to ensure that surviving partners of military veterans, who have also made many personal sacrifices, are recognized for their partnership with our veterans, the Government of Canada should consider removing the age limitation on pension inheritance.

Second, the Canadian government's programs and service operators should also be reviewed. Communication platforms should be streamlined to ensure ease of access to all programs, benefits, privileges, entitlements and associated eligibility criteria. In our study, we also recognized that peer support should be recognized and enabled to enhance support groups in other ways to ensure that survivors use social media or other communication platforms to support each other.

Third, survivors who enter into a relationship with a veteran late in life feel psychological strain due to various social stigmas. For instance, many of our participants mentioned that they're being labelled as “gold diggers”, which is unfair to this particular population. Those who received benefits upon their husband's death in service also feel guilty about getting money. These and other issues remain unaddressed, as the survivors are not provided counselling. Thus, social workers and psychologists should be made available to both veterans and their survivors.

In summary, our study showcases the struggles and challenges that veterans and their surviving spouses face. It is particularly noteworthy that survivors who married a veteran after his or her 60th birthday suffered the most, as the substantial cut in their income due to the loss of the military pension forced them to change their lifestyles considerably. Veterans who started a relationship after the age of 60 also concurred that the current policies on pension inheritance created uncertainty for their partners.

To end my presentation today, I would like to share two quotes from our research participants.

This is what one survivor told us: “My late husband was in the military for 32 years. He literally gave his life for the country. Now the legislation states that at age 60, you no longer are going to be interested in getting married. At age 60 you are too old to have a relationship any more. In normal circumstances, you can still have another 20 years with a partner. We do have concerns. The government really needs to look at that.”

[The Chair, Liberal, Emmanuel Dubourg]

Mr. Li, could you conclude in 10 seconds, please?

[Dr. Eric Ping Hung Li]

Sure.

The other witness said this: “Protect me, as I have you. Fair is fair. If I'm willing to stand in front of a bullet for you, why do you allow all these people, including yourself, to take shots at me when I'm disabled and senior?”

Thank you for having me today.

[The Chair, Liberal, Emmanuel Dubourg]

Thank you, Mr. Li.

Next we will hear from the Department of Veterans Affairs.

I'd like to invite Ms. Crystal Garrett-Baird, director general of policy and research, to go ahead for five minutes, please.

[Crystal Garrett-Baird, Director General, Policy and Research, Department of Veterans Affairs]

Good afternoon, Mr. Chair and members of the committee. Thank you for the invitation to be with you today.

I would like to begin by acknowledging that the land I am speaking with you from is the traditional and unceded territory of the Abegweit Mi'kmaq first nation.

I welcome this opportunity to speak with you about the concerns of both veterans who marry after the age of 60 and their spouses and survivors. We are happy to engage in this very important discussion.

I would like to begin by outlining the services and benefits currently offered by Veterans Affairs Canada to support survivors under two pieces of legislation, the Pension Act and the Veterans Well-being Act.

Survivors may be eligible for income support as a result of the veteran's disability pension, namely through a disability benefit survivor's pension. This is entirely unrelated to superannuation. Payments may also be made through the income replacement benefit. Additional compensation may be paid if the veteran's passing was service-related.

Some low-income survivors may also be eligible for financial support through the war veterans allowance or the Canadian Forces income support program. In addition, survivors are eligible for the veterans emergency fund, which provides financial assistance in the event of urgent and unexpected situations.

Finally, surviving primary caregivers of veterans may be eligible to receive veterans independence program housekeeping and grounds maintenance, provided that the veteran was in receipt of the service at the time of their passing.

As part of Budget 2019, the Government of Canada committed $150 million over five years to establish a survivor fund that would aim to better support veterans who married over the age of 60, as well as their spouses, and ensure that survivors have the financial support they need.

It is important to note that this fund does not change the marriage after 60 clause in the Canadian Forces Superannuation Act. This act is under the responsibility of the Department of National Defence.

After the veterans survivors fund was announced, we recognized that we needed information about these survivors' needs and the magnitude of the issue. This is because the only administrative data we knew with absolute certainty was the number of veterans who select the optional survivor benefit.

To this end, we collaborated with Statistics Canada and the Canadian Military and Veterans Health Research Institute to determine the size and characteristics of the survivor population.

This work was delayed by the pandemic. However, we have since received the results of this research and learned the following about living survivors.

An estimated 4,500 people entered into a marriage or common-law relationship with a veteran after the veteran's 60th birthday. In each of these cases, the veteran was a Canadian Armed Forces superannuate. Virtually all were female, and 90% were age 70 or older. Most had higher incomes compared with other Canadian females in the same age group. Their median income was $34,900 versus $25,600.

Finally, over 1,200 survivors, or 27%, were in receipt of the guaranteed income supplement. Approximately 850 of the 4,500 living survivors, or 19%, had incomes below the low-income measure, which was $24,890 before tax.

On this last point, we should consider the budget 2021 commitment to implement a 10% increase to the old age security program for those 75 years and older. This increase starts in July 2022. With this enhancement, it is anticipated that about 250 of the estimated 4,500 living survivors will have incomes below the low-income measure.

Now, let me be clear. We do not see this as an insignificant number, and we realize that it's not just about money. It is also about recognition.

We care about the needs of survivors, which is why we offer a number of benefits and supports in the package of programs I have just outlined.

We are using the results of this to best inform how to move forward with the veterans survivors fund.

Let me conclude by saying that Veterans Affairs Canada recognizes that the wives and common-law partners of veterans play a crucial role in the care of our veterans.

We are committed to ensuring that those who served and their survivors have the support they need.

Thank you.

[The Chair, Liberal, Emmanuel Dubourg]

Thank you so much, Ms. Garrett-Baird, for your opening remarks.

Now I'd like to invite, from the Department of National Defence, Brigadier-General Virginia Tattersall, director general of compensation and benefits.

Please go ahead for five minutes.

[Brigadier-General Virginia Tattersall, Director General, Compensation and Benefits, Department of National Defence]

Good afternoon, Mr. Chair and members of the committee.

I am Brigadier-General Virginia Tattersall, the director general, compensation and benefits for the Canadian Armed Forces.

Mr. Chair, thank you for inviting me here today.

I want to highlight that compensation and benefits for the Canadian Armed Forces are a topic of great importance. My responsibilities in the area of Canadian Armed Forces compensation and benefits include policy management and service delivery administration for everything from military pay and allowances to release benefits and military pensions.

You have just heard from my colleague at Veterans Affairs Canada, and I would like to take this opportunity to outline the role of National Defence in regard to the Canadian Forces Superannuation Act.

The Minister of National Defence, under the Canadian Forces Superannuation Act, is responsible for the overall management of the pension plan, including the financial management of Canadian Armed Forces pension funds. My organization is responsible for the oversight of the pension plan, contribution calculations, financial analysis, program advice, and interpretation and preparation of the annual reports, all in support of the minister's role.

We also conduct and contribute to the analysis, design and policy of the pension programs, including working alongside the Department of Justice and the Treasury Board when analysis is required for any changes or amendments to the Canadian Forces Superannuation Act.

I will be happy to take your questions.

Thank you for inviting me this afternoon.

[The Chair, Liberal, Emmanuel Dubourg]

Thank you very much, Ms. Tattersall.

We will now proceed to the question period. I would ask the members of the committee to please say who their questions are for; I ask the witnesses to please open their mike so that they may answer them.

I now invite Ms. Cathay Wagantall to speak for the next six minutes, please.

Ms. Wagantall, you have the floor.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

Thank you very much, Chair.

Thank you all for being here today. We appreciate your participating in this issue. As I'm sure you're aware, it has a great deal of emotion attached to it. You recognize that, and I appreciate that we have to consider that in the midst of all of this.

Dr. Li, first of all, I have a couple of questions for you.

When you mentioned the number who were engaged in the study and you gave the reasoning with respect to why there weren't more, you mentioned the impacts of COVID. You mentioned the inability to meet.

I know our Legions have a significant role in bringing people together, and I wonder whether there was an effort to engage the Legion to assist people in taking part in this via Zoom. I'm assuming a lot of the older individuals weren't familiar with those sources of communication. Was that something that was considered and attempted to any great degree?

[Dr. Eric Ping Hung Li]

We sent a couple of hundred emails to all of the Legions across the country. We sent probably around 500 email invitations to different churches and religious groups, because we believed that would be the vehicle. It was a bit unfortunate, because it was the beginning of COVID. There was no response, and they didn't really have a lot of gatherings. They cancelled pretty much all the in-person. We talked to a few Legions and leaders, but they would come back to us saying that they weren't having any lunches, and that's the way to really engage with those people and hopefully to them seek out. It turned out that we used quite a lot of our personal networks to try to get those numbers.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

Thank you.

It is disconcerting to me to realize that there wasn't a significant effort on the part VAC to work with the Legions to make it happen and have more individuals engaged in this process. I appreciate that response from you.

I see your recommendations here. You do talk about how information provision technology should be improved. Is that part of the picture you gained because of interaction with those you were able to talk to? Is it also possibly in regard to expectations to be able to perform the task that you were given?

[Dr. Eric Ping Hung Li]

I think it's more about how to support the survivors navigating those benefits and programs that can serve them.

When I talked to survivors about that, they just have difficulties. It's a double hit for them because of the financial struggle from the loss of pension and the loss of their spouse at the same time. They really spend months figuring out what to do and how to do it. Having said this, the information and communication platform is crucial.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

That's understood. Obviously, as if they're not going through enough already, they just don't have the capability to communicate in the way that would be needed. In that case, it would be good if we somehow had VAC available to be proactive in communicating with them in that regard.

You do mention the issues around psychological support for veterans and their survivors in this circumstance. We did hear about one veteran who made that decision to offset some of his pension for the future in the case of his wife needing that support. They made those sacrifices for him to be able to do that. Then she passed away ahead of him and those funds were no longer his.

Did you face that conversation at all? What was your sense of the psychological and emotional stress that would bring?

[Dr. Eric Ping Hung Li]

My data didn't really come directly to those conversations, but we do have veterans really worry about passing away before their partner. They really hope the partner can inherit the funds, properties or assets they have. We didn't really come to conversations about what if the partner passes away before them. We kind of stopped at that.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

I'm not sure which of the women who presented would best give this answer.

When that decision is made by a veteran, are they counselled in the fact that, when they make that sacrifice and put that money aside, if their spouse were to die then those funds would no longer be available? I would think that they would then invest that personally, rather than lose that as a possible means of income.

That's for Ms. Garrett-Baird or Ms. Tattersall.

[BGen Virginia Tattersall]

I will jump in to provide a response.

Just to be clear with respect to when an optional survivor benefit is established, the actual funds that are now taken by the annuitant making that decision never actually leave the pension fund. It's not like in a divorce where you would receive in the division of assets a cheque for an amount of money.

While there is a reduction of payments to the annuitant, those funds are still in the pension fund. That means that, in the event of the death of a spouse, they may revoke the optional survivor benefit and, therefore, the pension amount received by the annuitant goes back to 100%. While that benefit had been set up, the annuitant is not going to suffer on the death of their spouse.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

Okay. I understand that they get the full monthly pension payment back, but is there no kind of a payout for the fact that the money was their investment?

[The Chair, Liberal, Emmanuel Dubourg]

Mrs. Wagantall, I'm sorry. You're going to come back in the next round, so keep your question.

[Cathay Wagantall, Conservative, Yorkton—Melville, SK]

Thank you, Chair.

[The Chair, Liberal, Emmanuel Dubourg]

You're very welcome.

Right now I'd like to invite Mr. Sean Casey for six minutes, please.

[Sean Casey, Liberal, Charlottetown, PE]

Thank you very much, Mr. Chair.

I'd like to pick up exactly where Ms. Wagantall left off, because I am interested in the conversation around the optional survivor benefit.

To come back to her scenario, we have a veteran who decides to take a lower monthly amount in exchange for the right for his surviving spouse, in the event of his death, to receive a reduced pension. There has been concern expressed by the committee and by some of the witnesses that, where that happens and the spouse dies, the amount that has been forgone by the veteran effectively lapses.

I heard Ms. Tattersall indicate that if that death happens while the veteran is still drawing, that he or she is fully made whole.

My question is this, and I don't want it to appear cold or callous. These types of defined benefit programs are all based on actuarial calculations that factor in death rates and the like. If someone lives to be 100, they would draw more than the average. If someone dies the day after the papers are signed to make the transfer, they make less. Is that not the theory behind why what seems to be unfair to a certain group of people?

Ms. Tattersall, would you like to take a run at this? The person from the Treasury Board may have some comments as well.

[BGen Virginia Tattersall]

Thank you for the question. It's one that I'm not perhaps prepared to give you a fulsome answer to.

You're quite right that, in the broader sense, this is based on actuarial assessments. That means you will have some individuals who will draw five years of the pension benefits they have worked their entire career for. Equally, you may have someone who in fact receives a pension for over 40 years because they happen to have that longevity. It is all calculated on the basis of trying to achieve the best investment, so that the funds will be there to try to ensure you continue to receive your benefits, whether you are short-lived or long-lived.

I'm not sure whether that gives you a satisfactory answer. Perhaps this might be one that, because it applies to all the plans, Treasury Board might be better placed to answer.

[Sean Casey, Liberal, Charlottetown, PE]

I appreciate that.

It's just that it's my understanding that this is the nature of these types of funds. That probably didn't satisfy Mrs. Wagantall's curiosity, but I think we're both curious about the same topic, so we'll come back to it.

I want to come to you, Ms. Garrett-Baird.

What we're studying, of course, is focused on what survivors of veterans don't get, and you gave us a long list of what survivors of veterans do get. One thing you mentioned was a payment that is for survivors of veterans if the death is service-related. Can you expand on that a little more?

[Crystal Garrett-Baird]

Absolutely. Thank you for the question.

Essentially, where a veteran passes away as a result of a service-related disability—for example, they're on an overseas deployment and unfortunately killed during that situation—that would be considered a service-related death. Therefore, the income replacement benefit would be available to the survivor of that individual who passed.