Vol. 147, No. 21 — October 9, 2013
SI/2013-103 October 9, 2013
ECONOMIC ACTION PLAN 2013 ACT, NO. 1
Order Fixing October 1, 2013 as the Day on which Certain Provisions of the Act Come into Force
P.C. 2013-933 September 27, 2013
His Excellency the Governor General in Council, on the recommendation of the Minister of Veterans Affairs, pursuant to section 160 of Economic Action Plan 2013 Act, No. 1, chapter 33 of the Statutes of Canada, 2013, fixes October 1, 2013 as the day on which Division 8 of Part 3 of that Act comes into force.
(This note is not part of the Order.)
Pursuant to section 160, the Order fixes October 1, 2013, as the coming-into-force date of sections 156, 157, 158 and 159 of An Act to implement certain provisions of the Budget tabled in Parliament on March 21, 2013 and other measures (the Act), which received Royal Assent on June 26, 2013.
This Order in Council (OiC) brings into force sections 156, 157, 158 and 159, whichmodifysubsection 32(2) of the Pension Act, section 13 and subparagraph 4(3)(c)(ii)of the War Veterans Allowance Act (WVA Act). The amendments are to allow Veterans Affairs Canada (VAC) to exclude any payments made under the Pension Act in the calculation of VAC’s War Veterans Allowance (WVA) benefits.
On May 29, 2012, as a result of a Federal Court ruling in Manuge v. the Queen, the ministers of National Defence and of VAC announced that the Government of Canada would not appeal the Federal Court’s decision, and would cease the offset of Pension Act disability benefits from the Department of National Defence (DND) Service Income Security Insurance Plan (SISIP) Long Term Disability (LTD) benefit.At the same time, the ministers announced that the Pension Act disability benefits offset would also cease for VAC’s Earnings Loss (EL), Canadian Forces Income Support (CFIS), and WVA benefits to ensure a consistent approach between VAC and DND in how these similar benefits are calculated.
The Department of National Defence’s SISIP-LTD benefit provides a vocational rehabilitation program and income replacement to certain released Canadian Armed Forces personnel. VAC’s EL benefit is also an income replacement to ensure that those who do not qualify for the SISIP long term disability benefit receive a comparable level of financial benefits from VAC while undergoing a VAC rehabilitation program. VAC’s CFIS benefit provides an income support for modern-day veterans who have successfully completed a VAC-approved rehabilitation program and whose EL benefit has ended, yet have a very low family income. Similar to the CFIS benefit provided to modern-day veterans, the WVA benefit acts as a social safety net providing income support to assist low-income veterans of the Second World War and the Korean War (i.e. traditional veterans), and their eligible survivors and orphans, in meeting their basic needs.
As of July 1, 2012, SISIP-LTD ceased deducting the Pension Act disability pension amount in calculating the insurance amount to be paid. As of October 1, 2012, VAC’s EL and CFIS benefit calculations have ceased deducting the Pension Act disability pension amount.
Budget 2013, tabled on March 21, 2013, confirmed the Government of Canada’s financial investments related to the changes in the calculation of the SISIP-LTD, EL and CFIS benefits. It also proposed to continue moving forward with other relevant legislative changes. The Act, which received Royal Assent on June 26, 2013, included the necessary amendments to the Pension Act and the WVA Act to allow VAC to cease deducting the Pension Act disability pension amount from WVA benefits. These legislative changes are outlined in the following paragraphs:
- Subsection 32(2) of the Pension Act currently allows the withholding of an amount equivalent to payments received from awarding WVA, relief or unemployment assistance, or retroactive disability pensions, or retroactive increases in a disability pension payable under the Pension Act. This subsection has been amended so that VAC disability pension amounts, retroactive or otherwise, will no longer be considered in the determination of WVA benefits paid under the WVA Act.
- Subparagraph 4(3)(c)(ii) of the WVA Act currently authorizes the Minister to subtract certain monthly benefits when calculating the amount of the monthly WVA benefit to be paid. This subparagraph has been amended to allow the Minister to cease the deduction of the monthly benefits payable under the Pension Act and the monthly benefits payable under any similar or equivalent laws of the country in whose forces the veteran served, when determining the amount of benefit to be paid.
- Section 13 of the WVA Act currently provides that, subject to subsection 32(2) of the Pension Act, the rights of veterans to receive pensions under that Act are not affected by anything in the WVA Act. This section has been amended to remove the reference to subsection 32(2) of the Pension Act, consequential to the reference to the WVA benefit being removed from that same section.
- A transitional provision is required for individuals who are receiving WVA benefits and are also granted a retroactive pension award which pre-dates the coming-into-force date; therefore, the current terms of subsection 32(2) of the Pension Act would apply. Any overpayment of WVA created by such an award will continue to be recovered by a charge against the unpaid installments of the retroactive pension award.
The intent of these amendments is to allow VAC to cease deducting the Pension Act disability pension amount from WVA benefits. Currently, the calculations used to pay these similar VAC benefits (WVA and CFIS) are being done differently. CFIS benefits for modern-day veterans have ceased offsetting disability pension benefits in their calculations; however, this offsetting continues for traditional veterans receiving WVA benefits. Given both benefits have been designed with the same purpose of helping those veterans most in financial need, it would be unjust to continue this practice for one group of veterans while stopping it for the other groups.
Bringing these amendments into force will restore consistency in how these similar VAC benefits are calculated. With the changes, traditional veterans most in financial need will see an increase in the amount of their WVA benefits as disability pension benefits will no longer be offset, as is currently the case for modern-day veterans receiving CFIS benefits.
Veterans’ organizations have been advocating for many years for the federal government to end the practice of offsetting disability pension benefits. This was one of the many recommendations submitted to VAC by the Royal Canadian Legion and the Army, Navy and Air Force Veterans in Canada. The Canadian Veterans Advocacy (a stakeholder group) has also been advocating against the offsetting of disability pensions from EL, WVA and CFIS benefits.
Veterans’ organizations have expressed that they are pleased with the Federal Court ruling regarding the cessation of the deduction of the Pension Act disability benefits from the Canadian Forces’ SISIP, and that VAC will no longer consider disability pensions when calculating the EL, CFIS and WVA benefits. The VAC Ombudsman was also pleased with the Manuge v. the Queen Federal Court decision and used the opportunity to advocate for also discontinuing the offsetting of disability benefits under the Pension Act for WVA, CFIS and EL benefits. These groups, as well as other audiences, including veterans, media and the general public, will view the implementation of this change as positive.
The Department will directly inform stakeholders of the implementation of this proposal.
A proactive communications approach has been developed to cease the offset of monthly benefits payable under the Pension Act in the calculation of VAC’s WVA benefits.
Strategic Policy Integration
Policy and Research Division
Veterans Affairs Canada
161 Grafton Street
Daniel J. MacDonald Building
Charlottetown, Prince Edward Island