SISIP LTD 2002 - 2018

[retiredgrunt45]

I for one was made well aware about the claw back on my SCAN in 96, so it shouldn't be of any surprise to anyone. I was awarded LTD SISIP, a VA pension and my military pension was fully indexed upon release after serving my 23 years. That adds upto 75% of my salary until i turn retirement age. Would I like more money? Who wouldn't? The system is not setup to make anyone rich, it's there to provide the former member a reasonable amount of money in order to live comfortably, which I do. Want more buy a lottery ticket.

I often hear of members being released and complaining about, how are they going to  possible pay for a that new house, new vehicle or whatever they just purchased on this amount of money.  Sorry but that's your problem, not the systems. Move to a smaller house, buy a good used vehicle and thin out your wallet of some of that plastic that we all cherish so much. It's called being responsible for ones own destiny. I have no problems with either the VA or SISIP. Both my case managers are outstanding individuals and do a bang up job of taking care of my needs. When I joined we had to pay into our own SISIP premiums, thank God my Sgt/Major told me to sign on the dotted line and forget about it and that's exactly what I did. Now its automatic when you join, DND pays your premiums for you, so if one does get injured your taken care of.  I think some people are just not happy unless they have something to complain about. 

No I didn't ask to get injured, but I did and nothing is going to change that, suck it up, because that's life. I had to make some hard choices and changes to my life afterwards, but again that's life. We do what we have to do and that is just the way it is. I thank my lucky stars I have LTD benefits, otherwise I'd be living in a cardboard box on a street called somewhere.

Ask anyone in the private sector, how much they get if they get injured and can't return back to work, workman's comp may last a few years and unless you have a big fat insurance policy to cash in, they have 0, zilch, Nada thing. Makes you wonder who's getting the shaft...

 

[battleaxe]

I for one was made well aware about the claw back on my SCAN in 96, so it shouldn't be of any surprise to anyone. I was awarded LTD SISIP, a VA pension and my military pension was fully indexed upon release after serving my 23 years. That adds upto 75% of my salary until i turn retirement age. Would I like more money? Who wouldn't? The system is not setup to make anyone rich, it's there to provide the former member a reasonable amount of money in order to live comfortably, which I do. Want more buy a lottery ticket.

I thank my lucky stars I have LTD benefits, otherwise I'd be living in a cardboard box on a street called somewhere.

I too am thankful for LTD benefits- and my family has adapted well to life after my release. We’ve downsized, and have learned to live within the financial limits set by the 75% SISIP LTD provides.  I am also grateful for the pension I earned after 17 years in the CF, and that VAC acknowledges responsibility for my disability and medical care.

However (there is always a however to these things), I will never sit back and be smug about the position I find myself in.  My SISIP LTD was extended past the initial 2 year period due to the extent of my disability- but I know that not every released soldier can count on the same type of continuing support. 

I know that I have to badger physicians and specialists every year to provide medical documentation for continuing SISIP support (don’t you?)…and I also know that, for many, SISIP is nothing more than a glorified EI system that is abruptly stopped , for many, two years after release- irregardless of whether they are re-employed after release or not.

I can sit back and be thankful that, after 17 years in the CF, 75% of my wages upon release still amounts to a fair chunk of change.  However, many soldiers are released after 3, 5, or 10 years in, and 75% of their wages may not be adequate to care for their families and meet current financial obligations.

I am thankful that I was released later in life and career, after I had created a financial cushion for myself, had equity and savings and training and experience to fall back on.  However…I can still feel for younger people who are disabled and released- in the middle of the process of life and family- who may struggle to meet financial commitments despite the supports in place.

And…I can see how it may irk some people (like Manuge) to know that there are some people able to work full time and receive their full VAC pensions with no restrictions (cripes, there are still people working full time in the military and getting their VAC disability awards and pensions free and clear- because it is not supposed to be considered income) while his, because he is on SISIP and unable to work, is considered income and clawed back. This is what Manuge’s fight is about- why VAC is considered income for some (those on SISIP) but not others.

The topic of SISIP and VAC clawbacks has been done on this forum-I won’t get into it farther.  I just wanted to point out that, with issues such as this, it doesn't hurt to look at all sides of it.  When you look at this issue- do not look at it from the perspective of someone who has their 20 plus years in- or even 15 years in. 

What would have happened to you and yours if your medical release had occurred when you had 7 years in? 11? If SISIP had decided to discontinue your benefits?

That’s how I choose to look at this issue…because I know that I am very lucky to have been released when I was...and I realize I would have been in a world of hurt if it had happened ten years earlier.

Last thought:  Manuge is fighting a fight that may benefit many of us.  I’ve lost my VAC benefits (award, pension, whatever they call it?) for the entire time I’ve been on SISIP.  I haven't made a big stink about it, even though I think the policy is bizarre and unfair-never had the time or energy to fight the bureaucracy. Will I, however, turn down a back payment of those benefits if Manuge wins the class action suit and the clawback policy is ever changed? No.

I'm just curious- and I know this sounds confrontational but I can't think of a nice way to ask it, so I'm sorry but- will you?

Bren

 

[Greymatters]

Have to agree with Manuge, treating VA as income only benefits the insurance company, not the soldier.  Valid points when you consider that the VA is supposed to compensate you for not being able to fully perform a job due to injury, then SISIP uses that as an excuse not to pay money you need as income bacause you are still injured or in the middle of retraining. 

 

[retiredgrunt45]

I to can understand the plight some members who only have 3-7-10 years of service and suddenly being medically released, My post was not meant for these members. My post was meant for the ones who have their time in 20+ and get medically released and still complain about the benefits.

I do see both sides, but I also see former members who are drawing LTD pensions and claiming to be disabled working full time and then complaining their benefits are being clawed back by SISIP. If you can work full time, why should you be drawing the benefits in the first place. These LTD SISIP benefits are called (loss of wage benefits) and were designed for those of us who can't work any longer in a full time capacity. If everyone claiming this benefit did this, but weren't penalized, the money would quickly quickly dry up.

Some people refuse to admit that they are abusing the system, but complain the loudest.

Sorry but one can't have it both ways.

 

[GUNS]

Men, your situation is no different than civilians. As a soldier I was fully aware of my benefits or lack there of, when I joined. Yet, I stayed in. I left the military of sound body and sound mind(questionable). I was lucky to land a good job as a mechanic. At the ripe old age of 52 I became very sick and was forced to retire at 55 due to my illness.

I went on LTD from my company's insurance provider. Not nice! Hounded to death by the insurance provided to apply for Canada Pension (Medical). I applied to get the insurance provider off my back. When I was accepted for CP Disability, the insurance provider clawed back every cent.

Any taxable income that comes my way will be clawed back by the insurance provider. So your situation is not unique. My point of view on this is, I paid x number of dollars a month for LTD benefits which would be 80% of Take-Home, Tax Free. With the Claw-Back policy, the insurance provider is legally ripping me off of money that I paid for.

No matter how hard you fight for something, someone will always find a means to block your way. Most anyone can do is keep fighting.

 

[battleaxe]

but I also see former members who are drawing LTD pensions and claiming to be disabled working full time and then complaining their benefits are being clawed back by SISIP. If you can work full time, why should you be drawing the benefits in the first place. These LTD SISIP benefits are called (loss of wage benefits) and were designed for those of us who can't work any longer in a full time capacity. If everyone claiming this benefit did this, but weren't penalized, the money would quickly quickly dry up.

Thanks for the reply, but I need some clarification on this one...

My understanding is this...

If a released member is on SISIP and working full time, their wages are clawed back (rightfully so) by SISIP- as any and all wages are considered taxable income. Actually, only 50% of earned wages are clawed back - up until the point that the total income (LTD plus earnings) is equal to the salary upon release. This gives people an incentive to return to work- they can earn more than the 75% offered by SISIP.

But...no recipient of SISIP is able to exceed their post-release salary/wages and still receive any money from SISIP. 

They can remain under the protection of SISIP LTD for the first two years after release- just in case new employment opportunities don't work out. This added job protection is a needed benefit to counteract the fact that the CF does not accommodate for disability (ie. leaves members to find own post- release employment) and that CF members cannot draw EI. It gives a security blanket for two years so that released members can get their feet solidly back on the ground and into new employment after release.

So, while released members may be in the SISIP program, it does not necessarily mean that they are profiting from it or taking advantage.

The SISIP LTD program doesn't seem, to me, like a system that is easy to take advantage of or profit from.

Also, when you say that they are "then complaining their benefits are being clawed back by SISIP"- do you mean the VAC benefits that are clawed back?

I have often said that the worst thing the military ever did was to offer a disability pension/award to people who were still able to serve full time.  That policy created strife within the workplace and confusion for everyone. I feel that any and all compensation for service related injuries is best offered upon release- when disabilities and injuries affect future employability and quality of life (my opinion only).

But- if VAC is going to offer disability awards to members still able to serve and work full time- and call it a non-taxable/non-income benefit- then I feel that veterans under SISIP have every right to complain that the very same awards, for them, are considered income- whether they happen to be working or not.

That is my understanding.  Hope I'm not too far off base.

Bren

 

[battleaxe]

Any taxable income that comes my way will be clawed back by the insurance provider.

The sticky point here being that VAC disability awards are non-taxable and not supposed to be considered income. 
That's the gist, I think, behind the suit Manuge has launched.  Another point he is basing his suit on- that only those payments awarded prior to 2006 (the monthly payments) are subject to clawback.  Currently- with the new lump sum awards- there are no claw backs at all. (How on earth would they figure that out?)

Anyway, I agree with you that all you can do is to keep fighting...and that many of the situations that come up about employment issues and benefits are not unique to the military. It's hard to compare all the different variations in workplaces and policies, though.  Sometimes that best you can do is fight for those that affect you personally.

Hope it all works out well for you,

Bren

 

[retiredgrunt45]

Let me clarify, VAC benefits are not clawed back, these are a non taxable allowance not and income. But because there is no longer monthly pension awards being given, the member's lump sum award, whatever it may be is still tax free and not subject to any clawback.

SISIP benefits are different and come under (loss of wage category) which are classified as income and taxable as income. This is not and award such as the new VAC charter pays out to disabled members. This benefit was designed to replace (lost of wage earnings) that a member can no longer make due to a disability.  If someone is able to work, the money they earn is then deducted from their monthly SISIP payment. But let me add, that the member's benefit never goes below 75% of his earnings before they left the military under the extended LTD benefit. But what people seem to forget is if one is unable to continue working, their SISIP benefit is once again topped backup to the maximum, unlike UI benefits as someone mentioned earlier, which once you use up your stamps, it's gone and with each withdrawal the amount gets smaller. No comparison.

Also for those members with 20+ years who are being medically released, will have their military pension (superannuation) fully indexed upon release. You don't have to wait until you turn 60 and this can add upto and additional 30% on your pension. More years served, higher the rank, higher the indexed amount. The formulas is still (years served + your age upon release= 85.) In my case I would have had to wait till I was 64 for full indexing.

I admit there is still much room for improvement, but these benefits were designed to give a member 75% of there past salary and are still much more generous than what is currently available through the private sector under the workmans compensation act.

I feel what is going on at the moment with these court cases and what not, is going to have a lasting repercussion down the road. It can only go one of two ways. Either they will completely revamp the system or they will discontinue the benefits all together, due to cost overruns and the treasury department has the final say on this. If it's the latter, wait and see, if it's the last, alot of people are going to be left on very thin ice with no income. So the few who weren't satisfied with what they received, spoiled it for the majority of us who actually needed it.

 

[battleaxe]

retiredgrunt45,

I think we both have the same basic concern- that the ones who truly require available benefits (those who are disabled and unable to work) are vulnerable because the system is currently so screwed up.

I still find myself at odds with some of the things you are saying, however, and being the stickler for detail that I am, wish to pursue this topic a bit farther.
I hope you take my comments for what they are- an attempt to clarify and learn.  I’m concerned you’ll think I’m just butting heads with you- and that is not my intention.

You say, “VAC benefits are not clawed back”. But...in the case of Manuge- whose VAC award comes in monthly payments-they are being clawed back. 
That is the basis for his lawsuit.
Currently, those who receive lump sum payments under the new Veteran’s Charter keep all of their VAC benefit- the payouts are not subject to claw back. There are still many, however, who receive the monthly payments, on SISIP LTD, who see their VAC benefit clawed back.
You say that there are no longer any monthly pension awards being given.
There are no new monthly payments being awarded, for sure, but this does not mean that many people on SISIP LTD do not still receive monthly payments, and lose them to SISIP, under the old system.

About SISIP- After two years, if you can work, you’re taken off of SISIP LTD- and from what I know, there’s no going back on it.
If, after two years, you are found to be disabled and unable to work, you are kept on SISIP LTD and offered fair income replacement.
The system, IMO, is quite fair.

Re: the Manuge lawsuit. 
You say that, “the few that weren’t satisfied with what they received, spoiled it for the rest of us who actually needed it.”
Who is to say that Manuge doesn’t need it? 
He’s disabled, released, unemployed, and unable to work. His VAC benefits are being clawed back, while he sees many other CF personnel/veterans, able bodied enough to continue full time employment, collecting theirs free and clear. 
He’s decided to fight an injustice that many have grumbled about for years.
I can’t fault him for that. 
While I do agree with you that there is abuse of the system and many frivolous lawsuits- I don’t believe that his fight is in either of these categories.  I think his fight is one of the valid ones.

Anyway, I’m writing another book.  When I get on this topic I tend to go on… sorry about that.

Bren

 

[retiredgrunt45]

Hello Bren, My apologies, I didn't mean to come of as callous as it sounded. I didn't realize that he was under the old VA system.

Number 1: I still don't understand some of the complexities of his case. Is he able to work? And if he is, why is the VA taking money way from him? To me it doesn't make sense. I see many other vets collecting VA pensions and working, but their pensions are not clawed back. If that is the case, then yes he should fight it.

Number 2: Is he on permanent SISIP benefits? If not, why was he not placed on permanent status if he's no longer able to work. To me it sounds rather odd. The VA just doesn't subtract money from a members pension, there must be other underlying circumstances.

I contacted my VA representative and was told that VAC does not take money from anyone's pension for any reason. Once you have been awarded a pension at a percentage the amount will never decrease. You can asked to be reassessed to have your pension increased, but never decreased. Something doesn't add up here.

I receive both SISIP LTD and a VAC monthly pension. Never has my VA pension ever been clawed back. I don't know it just doesn't add up. Unless of course he is looking for 100% of his past income. This to me would be the only way it would make any sense.

This is the way it's designed to work under the old plan.

Superannuation (military pension) $XXX.XX number of dollars
VAC monthly benefit                    $XXX.XX number of dollars
Monthly SISIP pmt.                      $XXX.XX number of dollars
                                    Totals = 75% of your past salary (no more no less)

(SISIP makes up the difference between your superannuation and your VAC
to bring you upto 75%.)
                                   
I'm baffled, until I can find out more info about this case.

 

[the 48th regulator]

I agree with you wholeheartedly,

However, I was told at the onset of my injuries, due to the fact that VAC was caring for me, SISSIP was not entitled to help.  After I was released I am being reassessed by SISSIP, as I was medically released, however;

I contacted my VA representative and was told that VAC does not take money from anyone's pension for any reason. Once you have been awarded a pension at a percentage the amount will never decrease. You can asked to be reassessed to have your pension increased, but never decreased. Something doesn't add up here.

This is incorrect, if your injuries are found to be improving, you may very well be trimmed down from your percentage allotted to you.  I was also told this by both VAC, and my Legion rep.  It is rare when it happens, but there is absolutely no legislation that blocks it from happening.

dileas

tess

 

[DBA]

Note that it's SISIP that claws back benefits not VAC. It's the type of insurance SISIP is and it is legal so I  am not sure how far the lawsuit will get. It tops up your monthly VAC benefits and income.

Thinking on this more it might be better to lobby for conversion of 50% (or some other %) of VAC monthly benefits into a lump sum payment for those who wish it. The lowered monthly VAC benefits would mean less clawed back by SISIP and the lump sum would provide for more financial flexibility. Paying off the house or buying products to make going back to work easier are both more likely with a lump sum vs monthly payments. Still if money going out ends up still less than money coming in a lump sum will only last so long and then the situation would be worse with the lower monthly payments.

 

[Greymatters]

Men, your situation is no different than civilians... 

At the ripe old age of 52 I became very sick and was forced to retire at 55 due to my illness.  I went on LTD from my company's insurance provider. Not nice! Hounded to death by the insurance provided to apply for Canada Pension (Medical). I applied to get the insurance provider off my back. When I was accepted for CP Disability, the insurance provider clawed back every cent. 

This doesnt cover all workplace injuries for civilians though, which is different from the military system.  Many employees injured in the workplace are covered under Workers Compensation acts and receive immediate support and benefits.  Unfortunately the people coordinating the retraining programs arent all as smart as they should be, but every system has its flaws...

Edit - reread your posts and saw you already alluded to this...

 

[Greymatters]

Superannuation (military pension) $XXX.XX number of dollars
VAC monthly benefit                    $XXX.XX number of dollars
Monthly SISIP pmt.                      $XXX.XX number of dollars
                                     Totals = 75% of your past salary (no more no less)

I think this demonstrates the point very clearly.  IMO, the VAC should not be included in the calculations, period.

 

[retiredgrunt45]

Men, your situation is no different than civilians. As a soldier I was fully aware of my benefits or lack there of, when I joined. Yet, I stayed in. I left the military of sound body and sound mind(questionable). I was lucky to land a good job as a mechanic. At the ripe old age of 52 I became very sick and was forced to retire at 55 due to my illness.

I went on LTD from my company's insurance provider. Not nice! Hounded to death by the insurance provided to apply for Canada Pension (Medical). I applied to get the insurance provider off my back. When I was accepted for CP Disability, the insurance provider clawed back every cent.

Any taxable income that comes my way will be clawed back by the insurance provider. So your situation is not unique. My point of view on this is, I paid x number of dollars a month for LTD benefits which would be 80% of Take-Home, Tax Free. With the Claw-Back policy, the insurance provider is legally ripping me off of money that I paid for.

No matter how hard you fight for something, someone will always find a means to block your way. Most anyone can do is keep fighting.

With this in mind, how far will this go in court? Seeing that both civilian and military sectors have basically the same problems, this goes well beyond the scope of any one particular case and I can't see the insurance industry changing their policies any time soon.

 

[DBA]

The policy is most likely written the other way around in that they will make up any shortfall up to the limits of your coverage. If you get money from other sources there is less of a shortfall so they pay out less. If yours is all clawed back then it's just the same as all those who pay premiums and never get hurt - they get no benefits besides peace of mind as to being covered if things were worse. Like if the injury was deemed outside normal coverage but is covered by the top up policy. As well top up policies I imagine have much lower premiums than more direct coverage.

 

[battleaxe]

Hello Bren, My apologies, I didn't mean to come of as callous as it sounded. I didn't realize that he was under the old VA system.

Number 1: I still don't understand some of the complexities of his case. Is he able to work? And if he is, why is the VA taking money way from him? To me it doesn't make sense. I see many other vets collecting VA pensions and working, but their pensions are not clawed back. If that is the case, then yes he should fight it.

Number 2: Is he on permanent SISIP benefits? If not, why was he not placed on permanent status if he's no longer able to work. To me it sounds rather odd. The VA just doesn't subtract money from a members pension, there must be other underlying circumstances.

I contacted my VA representative and was told that VAC does not take money from anyone's pension for any reason. Once you have been awarded a pension at a percentage the amount will never decrease. You can asked to be reassessed to have your pension increased, but never decreased. Something doesn't add up here.

I receive both SISIP LTD and a VAC monthly pension. Never has my VA pension ever been clawed back. I don't know it just doesn't add up. Unless of course he is looking for 100% of his past income. This to me would be the only way it would make any sense.

This is the way it's designed to work under the old plan.

Superannuation (military pension) $XXX.XX number of dollars
VAC monthly benefit                    $XXX.XX number of dollars
Monthly SISIP pmt.                      $XXX.XX number of dollars
                                     Totals = 75% of your past salary (no more no less)

(SISIP makes up the difference between your superannuation and your VAC
to bring you upto 75%.)
                                     
I'm baffled, until I can find out more info about this case.

I'll apologize about the length of this post upfront...I had to include a letter in the text of the post because I couldn't get it to post with the specific internet address for said letter. So anyway...sorry..and grab a coffee...


Just to clarify- it is SISIP clawing back VAC payments (as DBA just mentioned) - his VAC pension amount isn't being decreased.

Is he working right now? I can’t say that I’m as sure about that as I may have sounded earlier.  I had read an article that gave me that impression but can’t find it right now…I’m looking…and I’ll get back to you if I find it.

Most current info I have is from July 19- Chronicle Herald article- that states his lawsuit was launched to “regain about $10,000 in disability pension that was clawed back from him for two years while he trained for a new career after being released from the army in 2003”. (From this I get that he was under the old system of monthly VAC payments and that he was on SISIP when the claw backs occurred).

Truthfully though, his employment status should have no bearing on whether or not he receives his VAC award.  That should be his free and clear whether he works or not or is on LTD or not.

Using your equations, he is saying that:

Superannuation (military pension) + monthly SISIP payment= (should equal) 75% of past salary (no more, no less)

...and then you should receive your VAC pension amount on top of that.

Can I ask whether your VAC claim was accepted prior to October 2000?  I don’t want to get into personal info you’re not willing to get into- but I can’t see any other reason that your VAC wouldn’t be clawed back by SISIP.  Those of us who receive monthly VAC payments (for claims finalized after October 2000) receive monthly VAC payments but have an equal amount clawed back by SISIP.

There are different scenarios of payment/clawbacks/awards based on when VAC claims were initiated and approved- we may just be all talking about different situations here.

Is that what’s confusing me?

Anyway…the best I’ve ever seen the SISIP clawback 'scandal' explained is in the following letter from Yves Cote to then Minister of Defence Graham in 2003 which can be found at this link: http://www.ombudsman.forces.gc.ca- under "Letters and Statements":



Letter to the Minister of National Defence regarding recommendations included in the 2003 Special Report
October 26, 2005

The Honourable William Graham, P.C., Q.C., M.P.
Minister of National Defence
National Defence Headquarters
Major-General George R. Pearkes Building
13th floor, North Tower
101 Colonel By Drive
Ottawa, Ontario
K1A 0K2

Dear Minister Graham:

I am writing with respect to the Special Report entitled Unfair Deductions From SISIP Payments to Former CF Members. As you may recall, my predecessor provided this report to former National Defence Minister John McCallum on August 27, 2003. On October 8, 2003, Minister McCallum wrote to the former Ombudsman, commenting that the report was “thoughtful and timely” and advising that he agreed with all of the recommendations it contained. The report was made public on October 30, 2003. On November 4, 2003, the House of Commons Standing Committee on National Defence and Veterans Affairs (SCONDVA) unanimously passed a motion imploring “the Defence Minister and government to accept and enact the recommendations forthwith.”

While three of the report’s recommendations have been implemented, two remain outstanding. These concern the offsetting (deduction) of Veterans Affairs Canada (VAC) disability pensions awarded under the Pension Act, awarded as compensation for a disability resulting from military duty, from the amount paid out by SISIP Long Term Disability (LTD) as monthly income replacement benefits.

It might be useful to describe some of the rules, terms and conditions relevant to these recommendations.

The SISIP LTD plan guarantees CF members 75% of their previous salaries for up to two years if they are released, in particular, because of a service-related disability. Payments can continue to age 65 if the member remains disabled.

However, SISIP LTD does not necessarily pay the whole 75% itself; under the plan, any other source of income a member receives is taken into account and offset from the amount SISIP pays directly.

VAC disability pensions, even though they are not considered income but rather disability benefits aimed at compensating CF members for injuries suffered in the line of duty, are considered a source of income under the SISIP LTD formula. Therefore, they are taken into consideration when SISIP LTD determines how much it will pay out to disabled former CF members in income replacement benefits.

The Ombudsman’s report recommended that since VAC disability pensions are not income, they should not be considered as income when calculating SISIP LTD benefits. The report also recommended that individuals who had previously had their SISIP LTD benefits reduced be reimbursed retroactive to October 27, 2000. (This is the date on which all serving CF members became entitled to collect VAC disability pensions while still serving, regardless of where their injury occurred. Before that date, only those injured in a special duty area were entitled to collect the tax-free disability benefit while still serving and collecting a salary.)

Following my meeting with you on September 27, 2005, our General Counsel, Mary McFadyen, met with your Special Assistant, Brian O’Neil on October 5, 2005, taking the opportunity to explain why we think these recommendations should be implemented, and pointing out the inherent unfairness in considering a pension intended to compensate for a disability as a source of income deductible from SISIP LTD payments.

It is important to emphasize that the new Veterans Charter may correct this inequity, but this will happen only from the date of its coming into force (possibly April 2006) onward; my understanding is that the Charter will not have any retroactive effect. This means that former members not falling under the new Charter (i.e., those currently in the system and any others entering the system between now and the coming into force of the Charter) will continue to be subject to the rules under examination here. In other words, those who are collecting SISIP LTD payments and receiving VAC disability benefits under the Pension Act will continue to have their SISIP LTD payments reduced by the VAC disability benefits they receive.

To illustrate why I believe this is fundamentally unfair, I would like to use the following hypothetical examples.

Let us examine the situation of two Master Corporals serving in the same Army unit, both having eight years of service and both being injured in the same incident (before the coming into force of the Charter).

MCpl A suffers injuries that leave him permanently disabled, but the disability is not severe enough to prevent him from continuing to serve in the Regular Force. Let us assume he was assessed at suffering from a 20% incapacity, which results in a monthly VAC pension of approximately $400.00. This is a pension which, normally, he would receive tax-free for the rest of his life. Assume further that this member continues to serve for another twenty-five years, and eventually retires as a Master Warrant Officer. On retirement, he will be entitled to a full (superannuation) pension based, of course, on his salary in his last five years of service at a higher rank than when he was injured.

According to the regime now in place, this member will receive his VAC monthly pension in addition to his Regular Force pay from the time of his injury to the time of his retirement, and, when he retires, he will receive it in addition to his superannuation pension. In other words, he will always receive his (tax-free) VAC pension in addition to his other income.

Let’s now turn to MCpl B who was much less lucky. His injury was much more serious. In fact, it was so serious that he was released from the CF as medically unfit to serve. He applied for a VAC pension and was assessed at 70% incapacity. This entitles him to a VAC pension of approximately $1400.00 per month (assuming he was single and had no children). Let us examine his situation in more detail:

he lost his job;
his physical impairment is so serious that the likelihood of his finding a civilian job may be extremely limited;
because he had only eight years of service, he is not entitled to (superannuation) pension payments;
under SISIP LTD his income will, upon release from the CF, be reduced to 75% of his regular force salary; and
he will not be able to collect his VAC pension in addition to his SISIP LTD benefits; on the contrary, the value of that pension will be offset from his SISIP payments.
The two examples I have just used – and I believe they are not farfetched – demonstrate why, in my view, there is a fundamental element of unfairness in the present system which leads to real and serious inequities. It is this very unfairness that the two recommendations that have not been implemented are meant to redress.

I believe that a strong case can be made that VAC pension payments should not be considered as income replacement as such, but rather as compensation for the consequences flowing from disabilities suffered (e.g., loss of enjoyment of life, loss of career opportunities, continuing pain and suffering, etc.).

Incidentally, I presume that the changes made in 2000 to allow Regular Force members to collect their regular pay and their VAC pensions were based on a similar rationale, i.e., that the VAC disability payments are not income replacement but rather that they are intended, as I just indicated, to act as compensation for losses other than losses of income.

If this is correct, and if one assumes that the primary purpose of SISIP LTD is to act as income replacement, then it seems to me that it would be logical – indeed, imperative – that a change should be made to prevent VAC pension payments from being offset from SISIP LTD benefits. Otherwise, the system will only be seen as condoning treatment that is significantly unfair and inequitable to those who, like MCpl B, are most disabled and who suffer most.

Because the situations that soldiers like MCpl B find themselves in result directly from their millitary service, from their service to their country, I believe they deserve better. They ought to be treated with care, compassion and generosity. They ought to be treated in a manner that is substantially similar to that of soldiers who are able to continue serving their country, in spite of the injuries they have suffered.

Given that this point was raised when we met, I would also add that, during the Office’s investigation of this matter, SISIP President, Pierre Lemay, advised us that removing Pension Act disability payments from the formula for determining SISIP LTD payments would cost approximately $5 million per year. We have not independently verified this. I will only say that if Mr Lemay is right, it does not appear that the money required to correct this serious inequity is disproportionate.

I understand that you have received advice from the Department on this matter, and will soon be making a decision. As you know, the role of an Ombudsman does not end after making recommendations. It continues afterwards to ensure that, to the extent possible, those recommendations are acted upon by the organization. As the recommendations in this Report have been accepted by your predecessor, the Honourable John McCallum, and also endorsed by the Honourable David Pratt, when he was Chairman of SCONDVA, I would urge you to consider giving effect to them.

As you know, there is considerable interest in this matter. The Royal Canadian Legion strongly supports these recommendations and we receive constant inquiries from serving and former CF members, as well as from members of Parliament and the public, as to whether or not the recommendations will be implemented.

I believe strongly that this inequity should be corrected. I feel a responsibility to update my constituents on this matter, and given the passage of time, I consider it imperative that I do so at the earliest opportunity. I would therefore suggest this matter be addressed on a priority basis.

I thank you for your thoughtful consideration of these recommendations and I look forward to what I hope will be a positive response from you.

Yours truly,

Yves Côté, Q.C.
Ombudsman

Hope it helps to clarify...and you might take note of the date- October 2005.  Manuge is fighting a fight that the Ombudsman recognized should be fought almost 2 years ago.  Sad?
 
Bren

 

[the 48th regulator]

Well,

Yesterday, I spoke with my case worker from SISIP/Manulife and I was told that I must submit copies of all my pay stubs, dating from the time of my medical release.  Then based on my Salary from my civilian employer, and the percentage I was awarded from VAC (I received my pension prior to the new charter) a decision will be made with regads what SISIP will cover me.

After that decision is made, I will be taxed on the total.

I made the comment, that, really there would be no use going forward as I see a total of zero being awarded to me.  She just nervously giggled.

Oh well, strike two with SISIP, I should have expected as much.

I would really like to see that legality of how they have this contract, and how the bid process went into it.

dileas

tess

 

[battleaxe]

After that decision is made, I will be taxed on the total.

OK, and I had never thought about this aspect of it until you wrote the above sentence, does that mean that we (those of us who have our monthly VAC payments clawed back by SISIP) are ultimately paying income tax on what is supposed to be a non-taxable benefit?

I can't wrap my mind around how that would work?

Anybody?

 

[the 48th regulator]

Apparently, if we are to be given SISIP payments to offset loss of income, in their infinite wisdom, it therefore becomes "taxable Income".

A second tier of clawback.

Just lovely.

dileas

tess