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URGENT SIPPIEMENTAL APPROPRIATION BIL, 1971

o
- o- HEARINGS

BEFORE

| SUBCOMMITTEES OF THE
, COMMITTEE ON APPROPRIATIONS.
HOUSE OF REPRESENTATIVES

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U.S. GOVERNMENT PRINTING OFFICE Q
59-161 O WASHINGTON : 1971

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JAMIE L. WHITTEN, Mississippi
GEORGE W. ANDREWS, Alabama
JOHN J. ROONEY, New York
ROBERT L. F. SIKES, Florida
OTTO E. PASSMAN, Louisiana
JOE L. EVINS, Tennessee
EDWARD P. BOLAND, Massachusetts
WILLIAM H. NATCHER, Kentucky
DANIEL J. FLOOD, Pennsylvania
TOM STEED, Oklahoma
GEORGE E. SHIPLEY, Illinois
JOHN M. SLACK, West Virginia
JOHN J. FLYNT, JR., Georgia
NEAL SMITH, Iowa
ROBERT N. GIAIMO, Connecticut
JULIA BUTLER HANSEN, Washington
JOSEPH P. ADDABBO, New York
JOHN J. MCFALL, California
W. R. HULL, JR., Missouri
EDWARD J. PATTEN, New Jersey
CLARENCE D. LONG, Maryland
SIDNEY R. YATES, Illinois
BOB CASEY, Texas
DAVID PRYOR, Arkansas
FRANK E. EVANS, Colorado
DAVID R. OBEY, Wisconsin
EDWARD R. ROYBAL, California
WILLIAM ID. HATHAWAY, Maine
NICK GALIFIANAKIS, North Carolina
LOUIS STOKES, Ohio
J. EDWARD ROUSH, Indiana
K. GUNN McKAY, Utah

FRANK T. BOW, Ohio
CHARLES R. JONAS, North Carolina
ELFORD A. CEDERBERG, Michigan
JOHN J. RHODES, Arizona
WILLIAM E. MIN SHALL, Ohio
ROBERT H. MICHEL, Illinois
SILVIO O. CONTE, Massachusetts
GLENN R. DAVIS, Wisconsin
HOWARD W. ROBISON, New York
GARNER E. SHRIVER, Kansas
JOSEPH M. MCDADE, Pennsylvania
MARK ANDREWS, North Dakota
LOUIS C. WYMAN, New Hampshire
BURTL. TALCOTT, California
CHARLOTTE. T. REID, Illinois
DONALD W. RIEGLE, JR., Michigan
WENDELL WYATT, Oregon
JACK EDWARDS, Alabama
DEL CLAWSON, California
WILLIAM J. SCHERLE, Iowa
ROBERT C. McEWEN, New York
JOHN T. MYERS, Indiana

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JOE L. EVINS, Tennessee CHARLES R. JONAS, North Carolina
GEORGE E. SHIPLEY, Illinois BURT L. TALCOTT, California
ROBERT N. GIAIMO, Connecticut JOSEPH M. McDADE, Pennsylvania
DAVID PRYOR, Arkansas DEL CLAWSON, California

J. EDWARD ROUSH, Indiana
G. Homer Skarin and Hunter L. Spillan, Staff Assistants

TUESDAY, MARCH 30, 1971.

VETERANS” ADMINISTRATION
WITNESSES

F. B. RHODES, DEPUTY ADMINISTRATOR
R. H. WILSON, Associate DEPUTY ADMINISTRATOR
J. D. SHYTLE, CONTROLLER
W. D. ROSS, DIRECTOR, BUDGET SERVICE
J. J. CORCORAN, GENERAL COUNSEL

DEPARTMENT OF MEDICINE AND SURGERY
DR. M. J. MUSSER, CHIEF MEDICAL DIRECTOR

IDEPARTIMIENT OF VETERAINS BENEFITS

o. B. owe N, CHIEF BENEFITS DIRECTOR

J. C. PECKARSKY, DEPUTY CHIEF BENEFITS DIRECTOR

E. R. SILBERMAN, DIRECTOR, BUDGETING AND PLANNING
SERVICE

J. T. T.AAFFE, JR., DIRECTOR, COMPENSATION, PENSION AND
EDUCATION SERVICE

Mr. GIAIMO. The committee will come to order. We are happy to have with us this morning the Deputy Administrator of the Veterans’ Administration and the others listed. We welcome you, Mr. Rhodes.

Mr. RHODEs. May I begin by saying Mr. Johnson is unable to be here. He had a speaking engagement that he has had planned for a long time and it is, therefore, my privilege to make this statement on behalf of the Administrator concerning the supplemental.

(1)

GENERAL STATEMENT

The President has transmitted (House Document Number 92–73) Supplemental appropriation requirements for WA programs totaling $835,877,000, as follows: $433.8 million for veterans' compensation and pensions benefit payments; $302.2 million for veterans' educational and training assistance; $99.9 million for increased pay costs resulting from Federal comparability raises effective December 28, 1969 (Public Law 91–231), and January 10, 1971 (Public Law 91-656). A tabular summary by appropriation of these additional requirements is attached.

COMPENSATION AND PENSIONS

Almost 80 percent of the $433.8 million requested for compensation and pensions is related to new legislation enacted subsequent to the initial budget submission. The compensation rate increases provided by Public Laws 91–262 and 91–376, along with the pension rate increases provided by Public Laws 91–588 and 91–376, account for most of the new legislation requirement of $345 million. The remaining $88.8 million of the request is due to changes in caseload and increases in average unit costs.

READJUSTMENT BENEFITS

We are requesting an additional amount of $302.2 million for readjustment benefits. Although certain new legislation, such as, Public Laws 91–584 and 91–666, Tave given rise to some added costs in this account, the primary pressure for increase has come from increased numbers of veterans participating in the academic and on-the-job training programs. Our estimate of the number of trainees is now 180,000 greater than was estimated in the original budget request. This training load increase together with rising unit costs have produced the additional requirements requested.

INCREASED PAY COSTS

Our supplemental appropriation requests for civilian pay act and wage board increases are included as a part of the Government-wide request in title II of the proposed 1971 supplemental bill. The total cost of these increases amounts to over $134 million, of which we are absorbing approximately $34 million. Our net request is $99.9 million. The distribution by appropriation account is shown in the attached tabular summary.

(The summary follows:)

VETERANS” ADMINISTRATION: SUPPLEMENTAL APPROPRIATION REQUEST-1971 (HOUSE DOCUMENT 92–73 DATED MAR. 23, 1971)

TITLE I
[In thousands]

New Program Appropriation account legislation increases Total Compensation and pensions---------------------------------------- $344,964 $88,815 $433,779 Readjustment benefits--------------------------------------------- 19, 200 283,000 302, 200

Total title 1----------------------------------------- -------- 354,134 371,815 735,979 TITLE II

Civilian Wage

pay act board Appropriation account increases increases Total Medical care------------------------------------------------------ $76,423 -------------- $76,423 Medical and prosthetic research--------------------------- ---- 3,384 $100 3,484 Medical administration and miscellaneous operating expenses--- -- 1,061 -------------- 1,061 General Operating expenses---------------------------------------- 18,930 -------------- 18,930 Total, title Il----------------------------------------------- 99,798 100 99, 898 Total, VA------------------------------------------------------------------------------ 835,877

Mr. RHODEs. This concludes the general statement, sir. We will be glad to answer any questions.

TOTAL APPROPRIATION FOR 1971

Mr. GIAIMO. What is the total Veterans' Administration appropriation for fiscal year 1971?

Mr. SHYTLE. The total appropriation for 1971 is $9,901,393,000 including $835,877,000 in anticipated supplementals.

Mr. GIAIMO. You are still under $10 billion, but not by much.

ABSORPTION OF PAY RAISE

From which appropriation are you absorbing the $34 million for pay increases?

Mr. RHODEs. Actually there was an additional $105 million appropriated for 1971. We discussed this with you when we were before you on the 1972 budget.

Mr. GIAIMO. That was for the medical care appropriation, wasn't it?

Mr. WIILSON. That is correct.

Mr. GIAIMO. You are using $34 million of that $105 million for pay increases?

Mr. RHODEs. Yes, sir. Thirty-three million dollars absorbed in medical care—$1 million in other accounts.

ADDITIONAL FUNDS VOTED BY CONGRESS IN 1971

Mr. GIAIMO. Does that mean you don’t need it for the purposes for which it was provided ? Mr. SHYTLE. Mr. Chairman, we testified initially on this. The Congress intended that the $105 million be used for medical care, to imrove staffing and to provide for several other items of expenditure reating to the direct care of patients. Due to the lateness of the enactment of this legislation it was not feasible for us to put this money into employment as intended by the Congress. We used $33 million of it for absorption of pay raise and the balance has been put into such things as fee dental and other direct medical care items. Mr. GIAIMO. As I remember, we had a discussion about some of the special units that we wanted you to get underway as fast as possible. Intensive care units, and some others. We had a long discussion about the fact that they weren’t becoming operative as quickly as everyone felt they should. Was any of that $105 million used for those purposes?

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