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Proceedings of the Standing Senate Committee on
National Security and Defence

Issue 11 - Evidence - Meeting of March 23, 2011

OTTAWA, Wednesday, March 23, 2011

The Standing Senate Committee on National Security and Defence, to which was referred Bill C-55, An Act to amend the Canadian Forces Members and Veterans Re-establishment and Compensation Act and the Pension Act, met this day at 4:03 p.m. to give clause-by-clause consideration to the bill.

Senator Pamela Wallin (Chair) in the chair.


The Chair: Honourable senators, ladies and gentlemen, thank you for being here today. This is a special meeting of the Standing Senate Committee on National Security and Defence, but we have received permission from the Senate to meet today. We are looking at Bill C-55, An Act to amend the Canadian Forces Members and Veterans Re- establishment and Compensation Act and the Pension Act.

We are pleased to have the minister with us today. He has brought officials with him, Mr. Hillier and Mr. Butler, who will also be available to answer questions. Welcome, minister, and thank you. We understand that you may get called back to a vote. We will understand that.


Hon. Jean-Pierre Blackburn, P.C., M.P., Minister of Veterans Affairs and Minister of State (Agriculture): Madam Chair, it is a pleasure to be here with you today to discuss a very important bill that is of utmost importance for our Canadian Forces members, our veterans and their families.

I know that our time together is short, so I will keep my opening remarks brief. But I do want to take a moment to thank you for the excellent work you have been doing on behalf of the men and women who have proudly worn, and wear, Canada's uniform.

Your commitment to our veterans' priorities is truly commendable, and your advice and recommendations have greatly informed our efforts on behalf of these national heroes.

Bill C-55 is a perfect example. In the drafting of this bill, we relied heavily on the insights and information available from many sources — including your committee, the House of Commons committee, and people in the field, such as veterans' organizations.

We listened to our veterans and Canadian Forces members.

When I travelled to Afghanistan last year, I remember specifically asking our troops there what we could be doing better. At first, they were a little hesitant about answering, but gradually they opened up. And one of the issues they raised was the disability award. They said it would be much more helpful if there were different options for how the disability award is paid out. We know that some people have not always used this money wisely. Instead of a lump sum payment, they wanted options.

Honourable senators, that had a profound impact on me. Here were these courageous men and women serving overseas in a very dangerous place risking their lives for Canada and our way of life, and they were reluctant to ask for much in return.

As a result of their comments, on the flight back to Canada, I decided that we had to go even further than I originally anticipated, that we should offer them these payment options and do even more than I was originally planning.

That is why Bill C-55, which is before you today, is very open-ended and very flexible when it comes to giving our Canadian Forces members and veterans more choices in the payment of the disability award.

We listened to what our veterans were saying. We looked at the various studies and reviews available, and drew from our own experience with the New Veterans Charter — all of which told us there were some problems with how the new charter was originally drafted. While the New Veterans Charter brought sweeping and significant improvements when it was passed unanimously by Parliament in 2005, it also had some flaws, which were discovered along the way.

I will add, as an aside, that since the coming into force of the New Veterans Charter, when our men and women in uniform return injured, they remain in the forces for two or three years. They continue to receive their full salary during that two- or three-year period. We didn't start discovering the flaws in the New Veterans Charter until after that.

You have pinpointed some of them. Our veterans have raised some of them. The bill that you are studying today proves that we are able to work together to correct these flaws. The result is legislation that has received broad support —because Bill C-55 represents an important new chapter in the New Veterans Charter and how Canada cares for and supports our military, our veterans and their families.

It amounts to an additional $2 billion to improve the quality of life for injured and ill veterans and their families.

Over the next five years alone, it represents an additional $200 million in support paid directly to our most seriously injured veterans and those with the lowest incomes and who are in a rehabilitation program.

And, with this additional support, our men and women injured in the line of duty will now be able to focus more on what matters most to them: getting better.

With the changes we are proposing, we are doing three things: we are ensuring a minimum annual income for veterans in our rehabilitation program, and for veterans who are unable to be gainfully employed again.

We are recognizing that Canada's most seriously injured veterans and their families face the greatest challenges starting a new life outside the military.

We are creating payment options for CF members and veterans who receive a disability award.

How are we doing this? By establishing a minimum income, as you can see in the bill — a pre-tax income of $40,000 a year for the earnings loss benefit. For those in a rehabilitation program, this will mean $40,000 in compensation or 75 per cent of their salary. That is the minimum. If their salary is higher, they will obviously receive more, but the minimum that they will receive is $40,000 for the duration of their rehabilitation.

Secondly, by expanding eligibility for the permanent impairment allowance and the exceptional incapacity allowance, we are creating a new $1,000 monthly supplement for our most seriously injured veterans. If they are unable to return to work, with the monthly allowance and the amount allocated for rehabilitation, they will receive a minimum of $58,000 per year until they reach the age of 65. This aspect covers someone who can no longer go back to work, because of a mental health problem or a physical disability.

By creating more payment options for the disability award, we will be recognizing that soldiers or veterans do not all have the same needs. They need financial options to meet their individual circumstances.

These enhancements go to the very heart of the New Veterans Charter, and they build on its solid foundation of making sure that the men and women who serve Canada have the help they need — when they need it and for as long as they need it.

There is wide agreement on that. Even those who say we should go further acknowledge that these are important measures and a big step in the right direction.

I want to stress that we have not stopped there, that we are taking additional actions in many different ways. I will list them for you briefly; you will recall what we did for amyotrophic lateral sclerosis, which we now recognize. As soon as a person receives that diagnosis, they can access all of the services they would have normally been entitled to, had the condition been recognized as an illness resulting from military service. We have resolved the Agent Orange issue by enabling widows to receive an ex-gratia payment of $20,000. I made that announcement just before Christmas.

These are all measures that will make a real and meaningful difference in the lives of the men and women who need this help from their country. Bill C-55 will also make a real and meaningful difference. We know this is true because our veterans and CF members have told us so. They spoke, and we listened, just as we promised we would. And we are taking action, just as we promised we would. Today, I am here to ask the Senate for its support to keep our important work moving ahead.

Current parliamentary dynamics, with the issue of an imminent election, have plunged us, as well as our veterans, into uncertainty. Passing this bill as quickly as possible is of the utmost importance.

If there were to be an election, before the bill were passed, it would mean postponing it for a year. I don't know how any of us will be able to look our CF members in the eyes, if we do not do what is necessary to get this bill passed in time. The support that they can receive from us is important to them.

I therefore ask you, on their behalf, to fast-track this bill so that it can receive royal assent.


The Chair: I want to thank you, Mr. Minister. I think we all feel that way on both sides. My deputy chair has been briefed on this legislation as well.

I want to thank you for changing your schedule. I know you were to be here Monday. I know you feel strongly about this.

Mr. Blackburn is here to take questions. I ask members to be pointed and disciplined in their questions because our time is short today.

Senator Plett: I will echo what the chair has already said. It is great to see you here, and I want to congratulate you for the way you have brought this forward. This has been a fairly extensive process, and I know you have engaged with many people.

In large part you have answered my first question. My first question was going to be, in your opinion, what happens if we cannot get this bill passed and get Royal Assent before a possible election? You have said that we would lose a minimum of a year and that it would be devastating for the men and women in uniform who so desperately need what you are offering.

You mentioned in your presentation, minister, how you have travelled and spoken to so many of the men and women in uniform. We did the same thing when we visited the base in Edmonton.

I know we would never get all of them, but would you believe that most of the concerns the veterans have shared with you are addressed in Bill C-55?


Mr. Blackburn: That is a good question, and I am happy to provide some clarification. Why and how did we end up with this? First of all, the Department of Veterans Affairs experienced an unprecedented crisis this past year. I wasn't expecting a situation like that. It started with newspaper articles, followed by radio interviews, TV reports and so on. Everyone had complaints about the New Veterans Charter and the department in terms of delays in processing files. Criticism was everywhere, to such an extent that, at one point, I turned off my BlackBerry and asked myself what should be done in a crisis like this. What is urgent, and what should the priorities be moving forward?

Of course, all of that factored into the number of times I had met with representatives of veterans associations; I had listened to them and heard their comments. We conducted a survey on the lump-sum payment and found that 31 per cent were not in favor of the lump-sum payment. We realized that they were primarily people with mental health issues or post-traumatic stress disorder. I had a very clear picture of the problem.

But we had to set priorities, assess the costs associated with all of that and take the complaints into account. At one point, we reached a consensus on the priorities with the organizations and our veterans. That is how we established the three priorities.

Bear in mind that the entire New Veterans Charter is focused on rehabilitation. We cannot ask someone who is 20, 25 or 30 years old and who comes back injured to go home and wait. We must enable them to transition to civilian life. We must help them find a new job, taking into account their new disability. That is what rehabilitation is about. We must also make sure that, while participating in that rehabilitation, which may last two, five or ten years, that person has an adequate income. The person may have one, two, three or more children; they may or may not have a spouse. We must ensure that things are done right.

That is why it is not reasonable to give the person at the low end of the pay scale in the army, someone who is earning $26,000, 75 per cent of their salary. That is not enough to live decently. That is what we will fix.

The permanent monthly allowance resembles the former pension system. It is a monthly amount ranging from $536 to $1,609 per month. I am referring to the former figure; it has been indexed, and I don't remember the new one. Depending on the injury, a member receives a certain amount per month, for life. It doesn't stop at 65, it is for life. It wasn't enough for people who are seriously injured. We decided to increase the amount by $1,000 per month. When you add the monthly payment plus the $40,000, the minimum that someone will receive is $58,000 per year, until the age of 65, if they cannot return to work, be it the result of a physical or psychological injury.

The other point regarding these injuries is an important one. There was a problem in the charter that had gone unnoticed up to that point: when the New Veterans Charter was adopted, injuries were taken into account following the coming into force of the charter. If someone had an injury predating that coming into force, it was not counted. As a result, people did not receive the amount ranging from $536 to $1,609. Only 12 or 16 people received it in five years. By fixing that aspect of the act, 3,500 people over the next five years will receive that monthly payment for life.

Lastly is what is called the lump-sum payment up to a maximum of $276,000. The amount is now $285,000 after indexing. They can receive that. They can spread it out over five, ten or twenty years, the decision is theirs.

Our bill does not guarantee that the person will make the right decision; there are no guarantees of that. If it were one of us, what would we do? Go to our spouse and say: I am receiving $285,000, I am injured, and I will never be able to go back to work, what is the best thing for my family and me? It will encourage people to think about the best choice for them.

That is what this bill offers. I can put myself in your shoes. You might be thinking that I have brought you this bill in the final hour and I want you to ram it through. Sometimes you have to have faith in life and believe that we have looked at it before. We are not sending you just anything. The House of Commons has considered it, as have veterans and associations representing them. Everyone agrees that it is a good step in the right direction.

I understand that some people want more. That remains, but there are no missteps here. All we can do after the fact is continue to make improvements as the needs arise and the budgets are allocated.


Senator Plett: When I spoke in the chamber yesterday, I used three people in my comments: Patricia Varga, Dominion President of the Royal Canadian Legion; Ray Kokkonen, President of the Canadian Peacekeeping Veterans Association; and Guy Parent, Veterans Ombudsman. They all indicated they were supportive of this first step.

We have said this is a living document. Can it be improved if necessary?


Mr. Blackburn: Of course we told our veterans that this was a living charter. We must be honest with them, and we must prove to them that it is a living charter. Today, we have our first chance to prove that it is a living charter and that we are in the process of correcting the problems that had been identified. We established priorities. There are a host of other things to change. We needed to start with the most urgent issues.

I will give you an example; I acted somewhat like a submarine captain. At some point, a pipe bursts and as you are fixing it, it starts leaking from everywhere. That is what happened at the department. At one point, I said to myself: I have to save the crew, the ship, and we need to keep the motors running so we can head in the right direction.

I acted like a responsible father, trying to do the right thing to support our veterans. I should repeat that there is still some work to be done and that if I stay in this position, I will continue to try to help them as much as possible.


Senator Mitchell: Thank you, Mr. Minister, for coming.

The Liberals will be supporting this bill, not because it is adequate, but because it is a start. We have concerns about its shortfalls, but we are taking it seriously.

You write that the Senate delayed this. That is wrong, and I want to clarify that. You announced this in September of 2010. You presented it to the house in November of 2010. We got it on Monday, and we will pass it tomorrow. We had four days.

The Chair: Senator Mitchell, can we stay on the bill, please?

Senator Mitchell: I will.

Finally, it underlines what many people are saying: You are very quick to buy the jets and you have been very slow to help the vets.

The earnings loss benefit will now be raised to $40,000. Why did you not do that before this proposed legislation? Why did you have to wait for this bill? You have regulations that would have allowed you to do that years ago. That underlines the point made, which I think is very inappropriate, that we delayed it. You could have done this a long time ago.

Is this $40,000 base retroactive to when the program was established? Will it pick up those who were injured and have not been paid this base up to this time?


Mr. Blackburn: Why do we have all of this now? Allow me to pick up on what I mentioned earlier.

Let's assume that you were in Afghanistan two years ago and that, tragically, you lost both your legs. When you get back from Afghanistan you have what is called a stabilization period. You stay in the armed forces for another two or three years and receive your full salary. When you are told you can no longer remain a member of the armed forces because of your disability, you leave the armed forces and turn to Veterans Affairs Canada.

Let's stay with the scenario of the individual who has just lost both his legs. First of all, he will receive a sum of up to $250,000 for his physical injuries. He will then receive up to $285,000 from Veterans Affairs depending on the extent of the injury. Subsequently, he will get all the other benefits as his coverage comes under our department.

At first, he remains in the Canadian armed forces and receives his full salary. So we do not immediately get involved. We discovered all of these problems approximately a year and a half ago when they blew up in our face.

Our department has aged at the same pace as traditional war veterans, who are now 87 years old, on average. The department would contact people using letters, and they would respond in writing or sometimes by telephone. That was the way we operated.

Today, the department realizes that young people prefer to use computers. Rightly or wrongly so, young people express their views in blogs, and information travels everywhere. So it is up to the department to make that shift and think of a transition.

We realize it cannot happen overnight. But the process is under way because we have reduced our processing time from 24 to 16 weeks. Here, I am referring to the entire process to determine the permanent disability award or any other amount that the veteran would be entitled to.

We are trying to improve this timeline, and for all our Afghanistan veterans, we have a rapid response case management team to address their needs. No, it is not retroactive.


Senator Mitchell: You make it sound as though no one has been paid less than the $40,000 minimum base. Some certainly have been, and you could have increased that for them before this piece of proposed legislation. You have led people to believe that it required legislation, and it does not. Those people, therefore, have been neglected. I am not saying that what you are doing now is not a help; it is, but you could have done it earlier.


Mr. Blackburn: Unless I am mistaken, it cannot be amended without legislation.


Bernard Butler, Director General, Policy and Research, Veterans Affairs Canada: The earnings loss is a regulatory change, so it does require the regulatory process.

Senator Mitchell: You have the power to do that now under your current act.

Mr. Butler: The regulations are there, but this change requires an amendment to the regulations. It is part of this package.

Senator Mitchell: You do not need legislation to change regulations.

I hope I am wrong about this, but I understand that if a public servant in Ottawa is injured while working and loses a leg, that person gets $350,000, but a soldier who is injured by a bomb in Afghanistan gets a maximum of $280,000. How do you square that?


Mr. Blackburn: First of all, you should not look at these things in isolation. These three elements work together, and other services are provided to soldiers based on their needs. For instance, if changes need to be made to their homes and a special rehabilitation program is required, there is a transitional program. If their spouse takes care of them, there will be an allowance of $100 per day for a year.

There are a host of other measures in the New Veterans Charter that did not exist in the past. It is a major change. That is why I am saying you need to consider the lump sum, the permanent monthly allowance and rehabilitation in combination.


Senator Mitchell: The public servant gets a disability pension and an earnings pension. The get all the same kinds of extra things, but they get as much as $80,000 more for losing a single limb, while a soldier can lose two or three limbs and get $80,000 less.

You say that this will cost $2 billion in additional funding, but in your own presentation you point out that it is to be $200 million over five years. Therefore, it would take 50 years to spend $2 billion. Are you not inflating the expectations of these military people with this kind of hype when they have to live with the reality that it is not $2 billion, neither today nor within a reasonable period of time? It is $2 billion over 50 years. It is cruel.


Mr. Blackburn: When I had to convince cabinet that this measure would not cost $2 billion, but rather $200 million over five years, I waged the same battle as you. I thought $2 billion was enormous.

I am the only minister to have obtained $2 billion from the government, an unanticipated amount, specifically during a recession.


Senator Mitchell: I am saying it is not.


Mr. Blackburn: From a financial standpoint, the Department of Finance must assess costs over a lifetime. That is why they must itemize the $2 billion in the budget. But in actual fact, disbursement for these various individuals amounts to $200 million over five years. I think Mr. Hillier wanted to add something.


Keith Hillier, Assistant Deputy Minister, Service Delivery, Veterans Affairs Canada: In addition to the amounts that the minister has referred to that someone would get from Veterans Affairs, the earnings loss and all the other programs, Government of Canada employees are paid under an insurance plan. I do not have the exact amounts, and I do not want to speak for the Department of National Defence, DND, but in addition to the amounts that an injured veteran would receive from Veterans Affairs Canada, there are payouts from the Canadian Forces and from the Canadian Forces insurance plan as well. The payment on behalf of the Government of Canada has to be looked at in its totality.

The Chair: We are going to move on.

Senator Mitchell: Have you done that assessment to see —

The Chair: Senator Mitchell, please.

We have a couple of complications. One, there is a vote in the Senate, so we will be returning there. We want to make as good use of minister's time as possible, and we have other senators who want to ask questions. I would ask again that we try to be brief and stay on the aspects of Bill C-55 and not the politics surrounding it.

Senator Banks: Thank you chair and thank you minister.

I have to agree with Senator Mitchell — and this concerns the bill — that the Senate has processes. It is not a good way to begin that process by sending a letter to us, which you did, saying, "following the refusal by Liberal senators to give fast track . . .'' That is not a good way to begin the conversation.

However, I want to ask Mr. Butler a question about a response that he gave to a question that Senator Mitchell asked. The earnings loss benefit authority was given in the regulations that are contained in the original bill; is that not correct?

Mr. Butler: Yes.

Senator Banks: It is the case that the regulations could have been promulgated in the Canada Gazette and gone to the Standing Joint Committee for the Scrutiny of Regulations even if this proposed legislation that is presently before us did not exist. Is that correct?

Mr. Butler: I think that is fair, senator.

Senator Banks: I just wanted to make that point.

Minister, what is the difference between permanent incapacitation on the one hand and permanent impairment on the other? We have information that the eligibility criteria for the supplement are different from the eligibility criteria for the base amount. We also have information that of the 269 veterans who were deemed to be suffering from total and permanent incapacitation between April 2006 and March 2009, 3 received the permanent impairment allowance. The other 266 are deemed to have permanent incapacitation but they do not qualify for the permanent impairment allowance. I would like to understand why.


Mr. Blackburn: I will try to answer your question based on my knowledge, and perhaps the people around me can complete my answer.

It all depends on when you were injured. It can be before the new charter came into force or after, or even a bit of both. To some extent, there is a chart for injuries and a percentage that is allocated. According to this percentage, the standard is established for the amount the person receives. That is how the process works.

Mr. Hillier or Mr. Butler may have more details on this.


Mr. Butler: You qualify for the permanent impairment allowance if you have a severe and permanent impairment. That is how it is defined in the act. If you are participating in a rehabilitation plan in respect of a disability for which you hold a disability award, you will qualify for this permanent impairment allowance.

For the most severe, if you have a total and permanent incapacity, which is defined in the regulations to mean that you are incapable of earning a livelihood more than 66.66 per cent of your pre-release salary, then you are deemed under the regulations to be totally and permanently incapacitated. It is a defined element in the legislation and in the regulations.

Senator Banks: In the present bill, however, I am told that the criteria for the supplement will be different from the criteria for the base amount. Is that correct? If so, how are those criteria defined as being different, or am I wrong?

Mr. Butler: The additional $1,000 supplement will be paid to those who are at the most severe end of that continuum.

Senator Banks: Is there a graduated system? Would some get $300 and some $700, or is it $1,000 or nothing?

Mr. Butler: In the schedule to the act, there are actually three levels of permanent impairment allowance — $600 and then it moves up to $1,600. They are paid in three categories, as per the schedule. Those who are at the high end of that amount and who are suffering a total and permanent incapacity will benefit from this additional $1,000 per month supplement.

Senator Banks: Would that be in addition to the $1,600?

Mr. Butler: Yes, it would be.

Senator Banks: Mr. Minister, you have heard the criticism that I am about to voice, because we have heard it, too. I would like you to respond to it so that we know what your response is. It is criticism that we have heard from veterans — old veterans and new veterans, if I can put it that way — that the reaction of the department to claims is rather along the lines of the reaction of an insurance company to claims. That is to say, as we all know, insurance companies try as hard as they can to not pay on claims. It is always difficult doing that, but you have heard that criticism before. For our record, would you respond to it, minister?


Mr. Blackburn: You must first consider the fact that these services are related to wounds sustained in the course of military service. This first point is very important and is the basis for all the services we provide to veterans.

Also, 75 per cent of the applications the department receives are initially approved. Of the remaining 25 per cent, between 50 and 75 per cent are approved when the decision goes to appeal. Often, these people then receive a positive response because they are bringing forward new information. In these cases, they go before the veterans review and appeal board to appeal a negative decision. Again, a decision is rendered.

A first negative response is therefore based on the information provided. When individuals come forward with new information that serves to correct the record or add information to the file, the decision may be altered in their favour, based on that information. This is the process that is lengthier, and that is not done on purpose. First of all, the medical file comes from the Department of Defence. An astronomical number of photocopies are made at the department. In fact, we want to change the system and computerize further. Then, we have to await the results of medical and other sorts of tests.

Perhaps Mr. Hillier has something to add to this point.


Mr. Hillier: Actually, I responded to that question at a town hall meeting at Canadian Forces Base Halifax.

Senator Banks: I was not there.

Mr. Hillier: I will reinforce what the minister said about the number. While 74 per cent get a yes on the first pass, I would like you to think about it in a little different context.

The people who serve in the Canadian Forces serve on behalf of Canada. People who work at Veterans Affairs serve on behalf of those who serve their country. Concerning this issue of the insurance company mentality, I can tell you — and I know some senators have visited Charlottetown and have met the with the adjudicators — the 60 people who come to work every day come to work to find ways to help veterans. They work to ensure veterans get the right answer. I can assure you that the employees of Veterans Affairs Canada do not come to work every day to deny a benefit, or a service, or a medication, or whatever a veteran needs. I think you will find quite the opposite. I have heard, you are quite right, senator, that they are instructed to say no the first time around. Quite frankly, that is not true.

The Chair: Thank you for those comments.

Senator Lang: I have a couple of observations. First, I do not share my colleague Senator Mitchell's views on what is being done here. I think he used the word "cruel,'' regarding what was done in the past. I think the department and the government have been doing the best they can with what they have. My experience at the base in Edmonton was that I walked out of there feeling proud to be a Canadian and proud of all the people who were taking care of those who were seriously hurt and the active members of the Armed Forces. As a Canadian, when you are projecting to look at spending $2 billion over the next number of years to reinforce and to supplement what we have already been providing, that speaks well for our country. We should not diminish the commitment that the taxpayers and Canadians are making.

I have a concern from that visit, however. I left there with the distinct impression that those members in the Armed Forces were really confused about what is available and how it would be made available. The question I have for you, Mr. Minister, is this: What public relations campaign do you have organized and ongoing for those members so that they realize what is there, what is available and how they will be taken care of, if they must avail themselves of something like that?


Mr. Blackburn: Indeed, that is another thing we noticed. Our personnel in the Canadian armed forces today do not know what will be available to them when they leave the forces, either upon retirement or due to an injury that renders them unable to serve. That is something we have noticed. People believed we offered strictly the lump sum and left them to their own devices afterwards. This is quite a change we need to make so people clearly understand that that is not the case, that there are a number of other factors.

To that end, I have toured the country on a number of occasions to meet, first of all, with our staff and, second, with our representatives and veterans in the various associations. Third, we went to the military bases to meet with members and inform them, as well as their spouses, about what is happening at Veterans Affairs and the services we provide. I think our members discovered something; they did not know what we offered.

We still have work to do in this area, we are far from done. We started off by doing what we could do. Of course, being a member of a minority government, I must be in Ottawa when the House is sitting. But we have done a fair bit over the last few months, we have done quite a few things.


The Chair: We will have a final quick point from Senator Pépin, and then we must go.


Senator Pépin: If I understand correctly, Mr. Minister, perhaps your department needs better communication with veterans. I also understand that the compensation you provide, be it the monthly benefit or total amount, can be increased in some cases as the severity of a condition or side effects come to light. I understand from what you are saying that does not mean these amounts will not increase.

Mr. Blackburn: First of all, those amounts are indexed each year. That is the first important point. Also, this time, most of the changes we are making are for modern-day veterans. Traditional veterans supported these changes 100 per cent because they also found that modern-day veterans needed special consideration.

We need to make other improvements. For instance, for the VIP — the amount we grant, approximately $2,650 per year, so people can stay at home and have someone come in to do housework, mow the lawn, shovel the snow —there are changes. We are currently looking at all of that to see what we can do. We also need to computerize our services. One decision we made was that all frontline staff would be able to make decisions independently; they no longer need to refer their decisions to a second level. That will speed up the process. They are professionals, they have all the knowledge needed to do a good job.

You saw the crisis that ensued when our documents and private information became public and was seen by too many people. We are currently rectifying that situation in our department. It involves bringing about a change in culture. Whenever I meet with staff, I like to chat with them. I think they do a good job, but at one point, there were shortcomings, which we are currently addressing.


The Chair: I am sorry for this. I appreciate your time today. We had to reschedule your appearance because there was a delay in the discussions. That is why we are meeting here in the Senate. We are glad you were so willing.

I assume that, if these changes are passed as quickly as we hope, they will be immediate. Can we say that?


Mr. Blackburn: If this bill is indeed passed before the house is defeated, through a non-confidence motion, should that happen, the changes would still take a few months before they enter into force, as we wait for regulations to be made. That would be five to six months minimum.

I want to tell you once again that what matters is for us to succeed. I think that if we can pass this bill before all that, everyone will be pleased. We will all be commended regardless of our political stripe; we will have done something good for our veterans.


The Chair: We will suspend our meeting right now. There is a vote in the Senate. We ask for the willingness of our other witnesses who are to appear today. For those of you who can stay and meet with us later, we appreciate it. If your schedule does not allow that, the clerk will be talking with you shortly.

(The committee suspended.)


(The committee resumed.)

The Chair: We suspended our meeting, as you know, because we had to return to the chamber for a vote. Mission accomplished and the vote is over, so we will now pick up where we left off.

Our apologies to you, Mr. Parent, as well, because we know you were here and all set to present testimony on Monday, but that was delayed. You are here now, and you have been delayed again as we had to go over to the chamber. I will ask you to keep your remarks to a couple of your key points about Bill C-55, because we are trying to focus our limited time on that.

Chief Warrant Officer (Retired) Guy Parent was appointed as the second Veterans Ombudsman in November of 2010 for a 5-year term, and he has almost 50 years of experience in both military and civilian worlds. We look forward to the benefit of his knowledge tonight. Please go ahead.


Chief Warrant Officer (Retired) Guy Parent, Veterans Ombudsman, Office of the Veterans Ombudsman: Honourable senators, as noted, my remarks should be rather brief.


I apologize if my address seems a little disjointed, but in the interests of time I will try to cover the main points. First, I would like to thank you for giving me the opportunity to be before you today and also to recognize the work you do on behalf of all the veterans.


There is long-awaited movement, through the introduction of Bill C-55, on two important fronts: the bill itself and the changes to regulations that will increase the financial support provided through the earnings loss benefit program.

So, this is cause for optimism, and we need to continue to build on this momentum.


The changes to the earnings loss benefit program, as well as those proposed in Bill C-55, respond to concerns expressed by veterans, veterans' organizations, parliamentarians and others. They do not address all of the concerns about the New Veterans Charter, but they do represent improvements. They are steps in the right direction.

I hasten to say, however, that there is a great deal of frustration and confusion about Bill C-55. In my opinion, the frustration stems from the expectation created that the New Veterans Charter would be a living charter, a dynamic document that would be modified to respond to the changing needs of our veterans and their families and continually upgraded to correct shortcomings or unintended consequences.

Well, it has taken five years for the principles of the living charter to become a reality. Based on my discussion with veterans and the veterans' organizations, it is clear that this long period of inactivity has had a negative impact on the acceptance level of the New Veterans Charter among stakeholders.

Additionally, based on discussions around Bill C-55 and particularly concerning the disability award, I venture to say that the communications efforts over the past five years have not been particularly successful in engaging Canadian Forces veterans in a dialogue and explaining in layman's terms the New Veterans Charter's focus on wellness and transition to civilian life, as well as its dual approach to compensation for pain and suffering and income loss.

The principles of the New Veterans Charter are sound. It is a good concept, but there have been weaknesses at the execution and communications levels.


I mentioned earlier that there is cause for optimism and that we are building on this momentum for change. Bill C- 55 must be seen as the beginning of the renewal process. Other improvements to the New Veterans Charter and to regulations are needed and must soon follow.


The increased supplement of $1,000 a month for permanently and severely injured veterans is also a welcome improvement. To receive the supplement, a veteran must suffer from both a permanent and severe impairment and a total and permanent incapacitation as defined in the regulation. Is that too restrictive? It may be. In fairness to veterans and their families, the department must exercise due diligence in drafting regulations to avoid creating eligibility barriers that prevent veterans from accessing these new benefits.

As for the disability award and whether or not the payment options provided under Bill C-55 go far enough to address the concerns around the lump sum, I am of the view that it is a first step only. Discussion about further improvements to the charter's dual compensation approach must continue.

Well-designed incremental changes to the New Veterans Charter and regulations can be an effective way of addressing emerging issues and the need for corrective adjustments, if done in a timely fashion, that is. As I mentioned in my remarks to the House of Commons Standing Committee on Veterans Affairs a few weeks ago, waiting another five years to bring about further improvements would be unacceptable.


Thank you for the opportunity to share my views with you on Bill C-55. I would be pleased to answer any questions you may have.

I look forward to meeting with you again at a later date to discuss my vision, my priorities and the way forward for the Office of the Veterans Ombudsman.


The Chair: At the Veterans Affairs Committee, which is a subcommittee of this larger one, we have been looking at the New Veterans Charter for many years, more than four I think at this point, and there will be a more substantive and fulsome report assessing the New Veterans Charter. However, it was our agreement that we would look at the bill here, because it does come to the main committee, and focus on that. Rest assured you will be invited back, probably to both committees when they next convene.


Senator Mitchell: Thank you very much, Mr. Parent. I very much appreciated your presentation. We greatly appreciate the work you have done for veterans.

I recently received an e-mail from a veteran who was asking a number of questions I would like to convey to you.


He wanted consideration of five different proposals. I will make them quickly. One is that the earnings loss benefit should be calculated to match current DND pay scales. I believe the corollary of that is that it should be moved from 75 per cent to 100 per cent, or a part of that. The earnings loss benefit should be calculated to increase with normal career progression because someone age 21 earning not very much could be disabled for the rest of his or her life and would not progress. The Pensioners Training Regulations should be amended to include all Canadian Forces veterans. The fifth one is that there be support for veterans to attend post-secondary institutions and further education, which he says was available to World War II veterans, for example.

Could you comment on what you feel about that, whether you feel those proposals are reasonable or what progress could be made?

Mr. Parent: They are all issues that are of importance. As far as the first one is concerned, we have to be careful. If you go to a program that is based on existing salary, it might be below the $40,000 because 75 per cent of a young private or a young recruit's salary probably will be below that amount. This is where we have to be careful in anything that is based on existing salary.

Senator Mitchell: The lesser of 1 of 100 per cent or $40,000 is the minimum.

The Chair: Can I please remind my colleagues that we are not here to take testimony on all the changes that everyone might see. We are here looking at a specific bill, and because our time is so short, I would really like it if we could stay focused.

Senator Mitchell: We are here to represent veterans, and that question was asked specifically of us by veterans.

The Chair: I have asked Mr. Parent to answer.

Mr. Parent: On the issue of the veterans accessing secondary education or other types of vocational rehabilitation or courses, the flexibility is there with the rehabilitation plan. They look at all aspects of what the veterans' needs are. I think one of the important things to recognize about this New Veterans Charter is that it is based on needs.

In fact, where the work has to be done is to make sure that the needs of the veterans are well identified and that they are pursued. I think that might not have been up to par in the past. If you base something on needs, you need the input of the person who actually is involved.

Senator Mitchell: The point was made by the minister in some of his material that there could be as many as 3,500 veterans who will benefit from the permanent impairment allowance in the future. That can only mean one of two things — either many people have been languishing and not receiving that benefit for many years, as many as five years, or he is anticipating huge future injuries to our military. How did we come to that figure of 3,500 people? It seems huge. We have 20 people on it now.

Mr. Parent: I cannot give you specifics on the number of 3,500. Maybe Mr. Hillier or Mr. Butler later on can clarify that point. All I can say is that many people do not have access to a permanent impairment allowance because they were in the dual program before. They had benefits under the old Pension Act and benefits under the New Veterans Charter; because of that, they could not access this permanent impairment allowance.

Another reason might be that some people are still in service. While they are in service, they are getting full salary and they are not getting this allowance, which would probably be available to them once they are out of service and deemed to be totally and permanently incapacitated.

Senator Mitchell: The point is made, and I think you made it too, that this is a start but nowhere near enough. One of the gaps is that support specifically for families is not sufficient. There are special requirements, needs and demands just for families. Do you have any itemization of the additional services that you think should be included in legislation of this kind in the future or should be included in policy in the future, both for veterans and for their families?

Mr. Parent: I will go back to the idea that it is a living charter. As it progresses and as these new amendments are incorporated, we do continue to analyze the impact on the veterans and their families and to provide adjustments, if need be.

Certainly, one thing with the New Veterans Charter — not necessarily Bill C-55 — is that now spouses have access to the same benefits as the veteran had before. In the case of someone who is totally incapacitated, his or her spouse can access the rehabilitation program and all of the financial benefits as well.

Senator Banks: The criteria that are set out to determine whether a veteran's injuries are sufficient for him or her to get the permanent impairment allowance must be very strict, because relatively few people are getting that, it seems. Are those criteria set out in regulations, and can they be changed by regulation, rather than by this bill that is before us?

Mr. Parent: Again, that is a question probably better answered by the department, but as far as I am concerned, the addition to the permanent impairment allowance is part of Bill C-55.

Senator Banks: It certainly is. I am talking about the criteria that set out how to get to the permanent impairment allowance.

Mr. Parent: The definitions of totally and permanently incapacitated or total impairment are in the regulations.

Senator Banks: It could be adjusted, notwithstanding this bill; is that correct?

Mr. Parent: I am not the departmental expert, but I expect that is the answer you would get from the department.

The Chair: As promised, Mr. Parent, we will be back to you on this issue and your thoughts on the whole question of how we deal with injured veterans. Thank you very much.

Senator Mitchell: Can I ask more questions?

The Chair: No, we are moving on here. Do you have a specific question about the bill?

Senator Mitchell: I certainly do.

The Chair: We will move on to our next witnesses. We invited all these witnesses at your behest, and we have forfeited our asking of questions.

I would like to take a moment now and apologize to you gentlemen because I know we have changed your schedule on several occasions, and we appreciate your patience and your willingness to be here.

Brad White joined the Canadian Forces in 1975 under the Officer Cadet Training Program. That was a great program. He retired from the forces in 1998 at the rank of lieutenant colonel and then joined the Dominion Command of the Royal Canadian Legion as an administrative officer. Five years later, he became the director of administration. He was appointed to his current position as Dominion Secretary in August 2009.

We also have with us Pierre Allard. After enrolling in the militia as a private in the Hull Regiment, Mr. Allard joined the Royal Canadian Navy in 1964 as a pilot. After retiring from the Canadian Forces in June 2001, he joined the Dominion Command of the Royal Canadian Legion as a service officer, and assumed the responsibilities of Service Bureau Director in January 2003.

Thank you, gentlemen, and again as I said to others, we are asking you to abbreviate your opening remarks. Please go ahead, and then we will have some questions.

Brad White, Dominion Secretary, Royal Canadian Legion: It is a pleasure to appear in front of you again today to represent not only our Dominion President, Patricia Varga, who is also a navy veteran, but also 342,000 members across this great country of ours. We thank you very much, particularly for your support and advocacy on behalf of our veterans of all ages and their families. We have provided you with a copy of our presentation today for your further reading, if you so wish.

We recognize that Bill C-55 is an interim measure. In the Royal Canadian Legion, we strongly support its passing as a first step to bring changes to the New Veterans Charter. We understand that there is also broad support among veterans' organizations across the country for the spirit of the New Veterans Charter, in regard to its focus on ability versus disability, transition to civilian life, compensation and its more complete approach to meet the needs of veterans and their families.

When the government introduced the New Veterans Charter in 2006, it made a promise to the veterans that it would be a living document. We agreed with the implementation back in 2006 on the basis that the New Veterans Charter would be a living document.

Gaps and deficiencies have been identified by the New Veterans Charter Advisory Group, which we are part of, through parliamentary standing committees and in other fora, including some of our own legion resolutions that have been submitted to government.

In November 2010, the Minister of Veterans Affairs stood up in front of the country and Canada's veterans and also made a promise to bring forward amendments to the New Veterans Charter. We agreed that this is a very important first step to make this charter into a living document. We believe that Bill C-55 will immediately improve the lives of the most seriously disabled veterans receiving disability benefits under the Pension Act and the New Veterans Charter.

There is still concern about the disability award and whether the flexible payment options provided under Bill C-55 address the concerns around the lump sum payment. We believe that we now have a limited improvement. A larger disability award has not been addressed. The first two presenters made that point. Australia provides a lot more to their veterans than we in Canada do. Disabled workers in Canada, through court decisions, receive more than our veterans do. Our veterans receive only just over $275,000 now for that permanent disability award.

We have already talked about the earnings loss benefit. The question was already raised as to whether it was part of a regulatory change or a bill change. We understand that as well.

The discussion about improvements to the financial compensation for the New Veterans Charter is extremely important and ongoing. The issues around financial compensation are complex and should not be construed as a comparison of disability award and disability pension in isolation of the charter's other programs and benefits.

The charter not only allows for lump sum disability awards for pain and suffering but also provides monthly financial support, if needed, such as earnings loss benefit, permanent impairment allowance, Canadian Forces income supplement, supplementary retirement benefit, case management, rehabilitation, transition assistance, family support and community outreach.

We agreed Bill C-55 is the first step. It is chapter 2. There is more to come, and we want to part of the ongoing discussion about what changes need to be made to improve the New Veterans Charter to ensure we look after our veterans in Canada. It has been five years coming down the road.

The passage of Bill C-55 will demonstrate to our soldiers that we have made a commitment to them, have kept our promise and will look after them when they need it. The charter has to be a living document.

Senator Mitchell: Thank you, gentlemen. We certainly have heard this point that you make and emphasize very appropriately that this is something, but not enough. Much more work needs to be done. Do you have a list, study or document that lists what it is? Suppose you were the prime minister for 15 minutes and you wrote this piece of legislation. What would you have put into it, and what do you think is fair?

Mr. White: You could look at the recommendations already made by the New Veterans Charter Advisory Group. That group is comprised of not only the legion but also leading people in rehabilitation, academia and other veterans groups. Those 17 recommendations incorporated into that advisory group report form the basis for changes to start. Bill C-55 starts to address some of those changes. It does not address them all. We need to look further into those recommendations and continue as situations evolve. One cannot take an individual and say that it is a cookie-cutter solution to his or her situation. One must be flexible and adaptable and ensure there is proper legislation to deal with the issues.

Senator Mitchell: Of the 17 recommendations in that document, how many are embodied in this piece of legislation?

Pierre Allard, Service Bureau Director, Royal Canadian Legion: We were looking at those 17 recommendations. Recommendations around rehabilitation, case management and care of families are already implemented. The earnings loss benefits improvements and unintended consequences of the permanent impairment allowance and the exceptional incapacity allowance have been corrected. There are still things that need to be done. However, it is important to make progress at this time, and Bill C-55 is a step in the right direction.

Senator Mitchell: I mentioned earlier to the minister that if a public servant in Ottawa were to lose a leg on the job, that person would get $350,000 in compensation. A military person who loses a leg or two in Afghanistan will get no more than $270,000. You alluded to the fact that in Australia they get more. In addition, workers here in Canada who go to court get more. What does Australia provide? What do workers generally get? Also, do military people have the option of going to court to get a settlement in addition? Or is it part of the deal that they get this money and cannot sue for more?

Mr. Allard: Both Australia and the civilian courts are probably in the range of $320,000 right now. A military person cannot go to court to seek resolution of his grievance. Having said that, the minister's staff indicated that one cannot look at the disability award in isolation to see how people are being compensated. In addition to the disability award, there is a SISIP accidental dismemberment insurance that provides $250,000. The disability awards under the New Veterans Charter provide $285,000. It is a bit unfair to make that comparison between what is provided to serving military.

Senator Mitchell: Has anyone listed that comparison? You are contradicting yourself, are you not?

Mr. White: It is not contradictory at all. The disability award is out there now. It is about $275,000 for the pain, loss and suffering. I lose my legs; I get a certain amount. That does not stop me from getting the rest of the benefits that Mr. Allard has spoken about, which are complementary to that loss. Others get that as well.

The Australian model, I think, is $325,000. Court averages are between $320,000 and $330,000, everything else being equal.

Mr. Allard: They do not have SISIP accidental dismemberment.

Senator Mitchell: What is your point, then?

Mr. Allard: Our point is that eventually the disability award should be increased.

Senator Plett: In Australia, is it not true that the older you are, the less money you receive?

Mr. Allard: You are correct.

Senator Lang: I seek clarification on the general discussion here. It is obvious that we have to compare apples with apples. If you compare apples to oranges, you can make a case on either side sound bad. However, it sounds like we have gone a long way to meeting the concerns.

With regard to its being a living document, could the changes that could happen over the course of time be made mostly through the regulatory process as opposed to having to come back to amend the New Veterans Charter?

Mr. White: I am not wise on the methodology for implementing the changes. If there are changes — these are the promises that have been made to people — we should look at these changes, research them and understand exactly what they are, how they will affect the individual and how they will affect the compensation. If it requires legislative change to get that done, then that should happen. If it is just something regulatory that you can do with the earnings loss benefit at this stage, it is even simpler. If the department has the power to make the changes within the department, that is fine.

Senator Banks: Many of these things can be done by regulation. However, some require legislative changes, and among those are changes to sections 19(1) and 23(1) of the original charter. Everyone is glad to see evidence that it is a living charter. This is the first time that it shows up to be the case. With regard to those two sections, the New Veterans Charter Advisory Group and the special needs advisory group both recommended that the amount should be moved from 75 per cent to 100 per cent.

Mr. Allard: That is correct.

Senator Banks: What is your comment on the fact that it was not?

Mr. White: We would like to see it go to 100 per cent. We think it is fair and equitable. It will assist in compensating the individual as he goes through.

Senator Banks: When the special needs advisory group and the New Veterans Charter Advisory Group make recommendations, are you satisfied that attention is paid to them? I picked out one single example where it was not, but are there examples where they are given effect?

Mr. Allard: We are happy that there is a systemic approach to making corrections where corrections are needed. It is true that veterans deserve the best that they can get because they have sacrificed their lives for their country and put their physical and mental health at risk. At the end of day, progress is made in steps, and we are happy that progress is made in steps. We are happy also that an amendment has been proposed in the current bill that would invite renewal on a regular basis of the New Veterans Charter so at least it would be looked at every two years. That is an important element to have in place that will at least not necessitate sitting for another five years before we see further improvements. There is a two-year window.


Senator Pépin: Among veterans, there are women.

Mr. Allard: Yes.

Senator Pépin: I am wondering whether they have different needs, special needs, or whether everything is equal and they get the same services and the same amounts as their male counterparts.

Mr. Allard: I think that we have already discussed the matter before the subcommittee and that you even met with female veterans. Clearly, their needs may be different. At the end of a day, the benefits are the same. As to whether there is need for refining, I believe so. But in terms of benefits, they are the same.


Mr. White: I would add that there should be additional study about what the needs are, because the needs are different.

Mr. Allard: They are more complex.


Senator Pépin: I agree. I am looking at your publication, which is quite nice, but there are never any woman pictured on it, always men. I like them. It was a comment. But I would like to see some women from time to time.


Mr. White: We can correct that next time.

The Chair: She always makes a good point.

Gentlemen, thank you very much. We look forward to speaking with you as we continue to take your advice and that of others. This is only just the beginning of the changes that are needed and desired and deserved. We will get back to that issue as soon as we possibly can. Thank you again for your patience.

We will now ask Brigadier-General (Retired) Joseph Sharpe to join us. Our apologies to you as well because we have been changing everybody's schedule. Joe Sharpe joined the Royal Canadian Air Force in 1965 under the regular officer training plan. He completed his military career as a brigadier-general, serving on the air staff as the director general responsible for air force development. He served as a special adviser to the CF/DND Ombudsman on Operational Stress Injuries, specifically post-traumatic stress disorder, and he currently serves as a board member of the Canadian Defence Association Institute.

You have heard my comment to the others. We will ask you for your brief comments on Bill C-55, the bill in front of us tonight, and then we will have some questions. Thank you.

Brigadier-General (Retired) Joseph Sharpe, as an individual: Thank you for the invitation. I will condense the points I was going to make to a couple of minimum ones.

I will touch briefly on the background. My interest in veterans started as the chair of the Croatia Board of Inquiry in 1999, a year or two before I took off my uniform. At that point, frankly, I was disgusted to discover how we were treating our veterans, and that became a lasting interest I have had in the years since I have taken off my uniform. I have an encompassing or ongoing interest in veterans affairs and how we deal with this. I have maintained contact with many veterans, and I am here today talking just as an old guy who talks to many veterans. I have served six years since retirement as an honourary colonel with the Air Force, and I am currently the Colonel Commandant for the military police, so I do maintain contact with many serving members on a regular basis.

I should also acknowledge that I chaired the financial gaps subcommittee of the New Veterans Charter Advisory Group. That is my ongoing interest in this activity, and what I bring in terms of Bill C-55 is that transition from the New Veterans Charter Advisory Group recommendations to Bill C-55. It is with that background that I will make a few comments on what I had hoped to see in Bill C-55.

In short, looking at the financial gaps, which is my focus, or my background, I had hoped to see two key issues dealt with in Bill C-55. To a certain extent, they have been touched on, so I am not black or white here on this one because there is a little bit of give and take.

The first thing we wanted to see was an end to a disability insurance approach to dealing with our veterans. I feel personally that that disrespects the sacrifice and the service that our members make.

We also wanted to see, and this is a bit of an esoteric point, a better approach to communication. Many of our veterans believe that the New Veterans Charter and Bill C-55 will not work well for them, but they do not understand it. We are doing a lousy job, to use a technical term, of communicating what is in these various pieces of legislation. Frankly, most soldiers cannot understand three quarters of what they see on the Veterans Affairs website that tries to explain this stuff to them. There is a problem there. We need to learn to communicate. With Bill C-55, I have not seen better communication than I have seen in the past. That is another major point.

There are two outcomes I would have been looking for in the objective of Bill C-55 and other changes that will follow. The goal, in my opinion, and this is, I guess, an opinion a bit tempered by talking with people, must be to ensure that veterans who are permanently disabled receive 100 per cent income replacement at a level consistent with a normal military career. I do not understand why we do not accept that as basically a context within which to discuss the rest of these issues. That can be easily and simply done.

Second, I believe the changes that are made to the New Veterans Charter ought to reflect an entitlement approach to economic benefits that acknowledges both the economic and the non-economic losses that a veteran suffers when his or her career is ended by an injury, either physical or psychological. I believe we must learn to treat our veterans and their families with respect and leave their dignity intact. That is what I mean by an entitlement basis and rather than, "I am injured, and here is what I want you to do for me.''

Bill C-55 has been described as a first step, and I recognize that. I certainly recognize that these changes must be made incrementally. We will not fix everything in one shot.

My personal opinion is that Bill C-55 misses the mark in that it does not yet ensure that members who are permanently disabled receive 100 per cent income replacement. I think that should be the first step. We are talking about 100 per cent at a level consistent with a normal military career, not one that is fixed at a point when the injury occurred.

It is certainly coming a lot closer and is making some very positive changes, at least for some of our members. I am not sure how many, but at least some of them are benefiting. However, I believe it needs to remain focused on reaching that ultimate goal of achieving 100 per cent. There are many troubling economic aspects still remaining with this legislation.

With respect to the non-economic losses, the options outlined in Bill C-55 for payment of the disability award are a very good start. However, the amount remains far below the equivalent civilian settlement, and that must be dealt with. The $500 sum is insufficient in terms of financial counselling, and a lot of the young guys I have talked to certainly needed financial counselling and did not get it. I am not sure whether more money there would have helped, since there are other issues.

Bill C-55 does continue to move the yardsticks forward, and that is a positive note. Veterans Affairs Canada should be congratulated on that. However, five years after the introduction of the New Veterans Charter, I am not sure they are moving either far enough or fast enough.

The Chair: Thank you very much for your very succinct comments.

Senator Banks: I have two questions. First, thank you for being here, and I will echo the chair's sentiments.

I am sure you know that all senators are in favour of this step. We will vote for it and it will pass, in short order. You talked about the insurance mentality. You did not use that word but I will. We asked that question earlier, and Mr. Hillier, who is still in the room, said it is not so. Some of us have been to Charlottetown and met with the people who do these things, and though we have never actually applied for these things and gone through the whole route, those people seemed really and truly dedicated to doing the best they could for veterans. I would like to you to expand on that a bit because Mr. Hillier told us earlier today that is not the case.

Second, I have a problem with the idea of how it would work. I do not mean I disagree with it, but I do not understanding how it would work. You said you want to get to the point where there is 100 per cent replacement of income based on a normal military career. I do not know what a normal military career is or how you would actuarially determine that.

It is not normal that someone who joins as cadet, and who perhaps gets to be a corporal, eventually becomes a brigadier-general. I do not know what normal is. I know what you mean in that you cannot lock in someone who injured as a sergeant to a sergeant's salary, but they will not all become colonels or brigadier-generals, or even majors. How would you determine what is normal?

Brig.-Gen. Sharpe: I have often been called not normal in the past but I will take that in a positive sense.

The Chair: We are on the record here, I want you to know.

Brig.-Gen. Sharpe: I will touch on your second point first.

Regarding what makes a normal military career, I had a couple of chats about this issue with Lieutenant-General Semianiw when he was the Chief of Military Personnel. Quite frankly, it is easy to predict what a normal career is. The average soldier who joins as a private will not become a Canadian Forces chief warrant officer but will probably become a master warrant officer over the course of 25 to 30 years. The average officer, joining as an officer cadet, will probably retire as a major or a lieutenant-colonel. Depending on trade, education and other factors, we can come up with a relatively accurate model of what an average career would be.

My concern with basing it on the rank at the time of injury is that, if that injury had not interfered with a normal military career, the average individual would have seen an increase in baseline salary over the years, retiring at this other level. There should be something to reflect that model in the economic awards that we are talking about — not the non-economic awards. That is not hard to do. A model can be developed.

Senator Banks: There are 40-year sergeants.

Brig.-Gen. Sharpe: Yes, certainly. In talking with personnel people, we would be looking at averages and averaging out the 30-year captain with the 20-year brigadier-general, over a group of people.

Senator Banks: And warrant officers.

Brig.-Gen. Sharpe: Since I have become a part of the military police officer organization, we know someone may not have the same opportunities for rank progression that a fighter pilot would. Most pilots are promoted well beyond their level of expertise. I am a navigator, by the way, and Mr. Allard was a pilot, so there is a little bit of that in here. We can do that.

On the first question of the insurance mentality, that is not something I would attribute to the people in Veterans Affairs Canada. I have physically worked closely with the people inside Veterans Affairs for the last 10 years. There are some very dedicated people in there. It is not the people but the regulations and the rules.

I now chair what was the Mental Health Advisory Committee. We had a meeting here about eight or ten months ago. A senior VAC person almost broke down at that meeting, explaining why they could not do the right thing in one particular circumstance because the rules would not let them.

Therefore, when I talk about an insurance-based mentality, it is a bureaucratic mentality, not a people mentality. We are not talking about bad people but rather about rules that have not been thought through in the sense of how they impact people in many cases.

Senator Banks: There have to be rules, though.

Brig.-Gen. Sharpe: Absolutely.

Senator Banks: So your point is that they should be more flexible, then.

Brig.-Gen. Sharpe: They should be devolving more authority down to individuals in the system, and we would have a much better process.

Senator Mitchell: I wanted to follow up on that last comment. I was about to make or emphasize that point. It is clear when we met people who work there that they care deeply, but it is still happening. Therefore, what is the reason? You are saying it is the rules. That makes sense.

However, what process do you think we could recommend for changing those rules? Have you thought about that, or are you aware of it? Would it be a task force or people like you who are brought in?

Brig.-Gen. Sharpe: I hate to toot our own horn, but the New Veterans Charter Advisory Group did some good work, and we did good work because we had good people, including Veterans Affairs Canada staff who were assigned to our subcommittees. In that 60- or 70-page document, there are some very good ideas on how to do that. I would hesitate to introduce those at this stage.

The Chair: We have studied those in the Veterans Affairs Subcommittee.

Brig.-Gen. Sharpe: It is a good piece of work.

Senator Mitchell: Let us get back to the point that you emphasized as your priority, which is the 100 per cent base instead of 75 per cent. I would like to understand what that might mean.

If an officer or another rank was earning $80,000 a year, under your proposal he would be eligible for the lesser of 100 per cent or $40,000. What currently occurs is that he gets the lesser of 75 per cent or $40,000. In that case, he would get $60,000 a year for the rest of his life instead of $80,000 a year.

If he was not injured and stayed in the forces for another 20 years and never received a single raise, he would have earned $400,000 more than he could now earn because he is injured. In addition to that, he might have been promoted to a rank that paid $120,000 over 20 years, so the average would be $100,000 over those 20 years, which is another $20,000 that becomes $400,000. Therefore, under your proposal, someone who is injured and who can therefore never progress in any career would be out $800,000.

That is what we are talking about. That is a huge impact on someone's life — someone who sacrificed a whole bunch of what he was physically and otherwise to all of us Canadians.

Brig.-Gen. Sharpe: I will comment on that briefly.

The philosophy is that, if you are a young solder off doing your job, you and your family have a quality of life and a certain expectation of maintaining that quality of life. I am troubled that we have a system that assumes you should only maintain 75 per cent of that quality of life. That is right at the beginning.

I can be corrected on this, but I believe the 75 per cent was originally an idea that was based on this being a tax-free type of pension or benefit. If it was taxed, then, it should be 100 per cent. If not, then it ought to be 75 per cent. We have to go back and have a think about that as the changes come forward in the future.

Why would we automatically assume 75 per cent is good enough for someone who is totally, permanently disabled? I have, on a personal level, dealt with a number of families for whom a drop to 75 per cent was very serious for the family's quality of life.

Senator Mitchell: Yes.

Brig.-Gen. Sharpe: That is what motivates me on this one. I have not done any of the sums, I must admit. I have done some visits and looked at some. A family in Winnipeg, for example, lost their house as a result of that.

Senator Mitchell: A drop of 25 per cent would be catastrophic for most people and even those not under the pressures of grievous injury and psychological and physical problems.

Brig.-Gen. Sharpe: To me that is fundamental. That is why I am not disappointed to see us moving forward. Bill C- 55 is great: We are seeing momentum; the point has been made that it is a living charter; and we need to see this process happening. However, I am disappointed we did not grapple with that issue right at the beginning.

Senator Mitchell: The flip side is that a soldier who has been receiving this program to this point, let us say for the last five years, and who is at three quarters, if he was earning $40,000 when his injury occurred, is now getting $30,000. He has lost $10,000 a year over what he would have received had this $40,000 base been in five years ago. That is $50,000. Would you make a case for this being retroactive?

Brig.-Gen. Sharpe: I am not technically qualified to say that, but conceptually yes, absolutely. We have a problem of unintended consequences of changes. I do not want to go too far down that road, but if we do not think through the consequences of the changes, sometimes we have some serious unintended ones, and we end up with a whole bunch of guys marching on Parliament Hill because they see some inequity in the system. We need to think some of these things through. I am not qualified to actually to say.

Senator Mitchell: Is it worth pursuing?

Brig.-Gen. Sharpe: It is worth pursuing.

The Chair: Thank you very much. We appreciate your comments and your thoughts, and we will hear from you again in the future because I think everyone agrees with the advice we have heard here again today, and that it is a start and a good one, but it is just a start.

Is it agreed, honourable senators, that the committee proceed to clause-by-clause consideration of Bill C-55?

Hon. Senators: Agreed.

The Chair: We have officials in the room who have agreed to stay in case anything comes up that we do not understand.

Shall the title stand postponed?

Hon. Senators: Agreed.

The Chair: Shall clause 1, which contains the short title, stand postponed?

Hon. Senators: Agreed.

The Chair: Shall clause 2 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 3 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 4 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 5 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 6 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 7 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 8 carry?

Hon. Senators: Agreed.

The Chair: Clause 9?

Hon. Senators: Agreed.

The Chair: Clause 10?

Hon. Senators: Agreed.

The Chair: Shall clause 11 carry?

Hon. Senators: Agreed.

The Chair: Clause 12?

Hon. Senators: Agreed.

The Chair: Clause 13?

Hon. Senators: Agreed.

The Chair: Shall clause 14 carry?

Hon. Senators: Agreed.

The Chair: Clause 15?

Hon. Senators: Agreed.

The Chair: Clause 16?

Hon. Senators: Agreed.

The Chair: Shall clause 17 carry?

Hon. Senators: Agreed.

The Chair: Shall clause 18 carry?

Hon. Senators: Agreed.

The Chair: Clause 19?

Hon. Senators: Agreed.

The Chair: Clause 20?

Hon. Senators: Agreed.

The Chair: Clause 20.1?

Hon. Senators: Agreed.

The Chair: Clause 21?

Hon. Senators: Agreed.

The Chair: Shall clause 1, which contains the short title, carry?

Hon. Senators: Agreed.

The Chair: Okay. Shall the title carry?

Hon. Senators: Agreed.

The Chair: Shall the bill carry?

Hon. Senators: Agreed.

The Chair: Wonderful; thank you very much.

Senator Nolin: Do you want to report back?

The Chair: Yes. Is it agreed that I will report this bill as soon as possible to the Senate?

Hon. Senators: Agreed.

The Chair: If they are still sitting, I will be running over there in just a moment, but we do not know whether they are. Can we have officials look at that? Thank you.

I truly appreciate this. I know that this is a complicated matter, and I really do thank you for moving with this as quickly as you did. I thank you for staying. We have brought you here and kept you here, and now we do not need you. We want you; we just do not need you.

Does everyone agree that we can go in camera for a moment to deal with the budget?

Hon. Senators: Agreed.

(The committee continued in camera.)

(The committee continued in public.)

The Chair: We will return now to the public portion of our hearing. We have a motion from Senator Lang, please.

Senator Lang: I would move a motion in respect to the forthcoming budget for 2012. I move that the following budget application for national security and defence policies of Canada for the fiscal year ending March 31, 2012, be approved for submission to the Standing Committee on Internal Economy, Budgets and Administration, following a final administrative review that will be overseen by the steering committee for a total of $545,406.

The Chair: All in favour? Question?

Senator Banks: Are you sure you want the line about final arbitration by the steering committee?

The Chair: We have replaced that.

Senator Banks: You can leave that little bit out.

The Chair: What will happen to cover is if they have said go and take some out of it, and if we need to do that quickly, so it is kind of a second stage. Is that wording still fine?

All in favour then?

Hon. Senators: Agreed.

The Chair: Thank you very much. That is agreed, and we will send it forward.

Again, thank you all very much for dealing with this so expeditiously. We will now see if the rest of our colleagues in the Senate will.

(The committee adjourned.)