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riage is void or is annulled. A similar permanent bar exists when a widow lives with another man and holds herself out openly to the public to be the wife of such other man.

Operation of those permanent bars has produced harsh results. For example, hardship results if a remarriage is shortlived and the widow emerges from the subsequent marriage in a worse economic position than before. In these and similar circumstances, it is reasonable to assume that the veteran would have intended that a measure of support be provided for the widow during any period in which she is not remarried. Like considerations apply to cases involving widows whose past associations with other men, subject to prior restrictions, currently constitute a bar to benefits.

A representative proposal would authorize payment of death benefits to all such widows when (a) the remarriage is terminated by death or divorce, or (b) the relationship with another man which

gave

rise to denial of benefits has terminated, as the case may be.

The proposed liberalized treatment of widows of veterans follows the trend established by similar liberalizations authorized for widows seeking social security benefits or civil service retirement benefits. The proposal represents a logical and equitable extension of the theory on which our benefits are provided for widows, and we accordingly favor its enactment, effective July 1, 1970.

(2) The second subdivision consists of a bill which would revise the definition of "child," for purposes of veterans' benefit programs generally, to recognize an adopted child as a dependent from the date of issuance of an interlocutory decree.

At the present time the term "child” is defined as including a "legally adopted child.” Generally, a legal adoption is one in which a final decree of adoption has been granted or in which a prescribed period has expired following the issuance of the original decree. Until then the interlocutory decree may be rescinded and the child will revert to his prior status.

We believe that the concern for the child which the adoptive parent has thus expressed and the parent-child relationship which exists following the issuance of the interlocutory decree is at least as strong as that existing where an individual has accepted a stepchild into his household. Current law recognizes such children. It follows that the provisions of existing law which limit the recognition of an adoptive child to those with respect to whom a final decree of adoption has been issued discriminate against both the adoptive parent and the adopted child.

This bill would permit the recognition as a “child” of one for whom an interlocutory decree of adoption has been granted and, if a claim was then pending, would permit the payment of benefits from the date of that decree, unless and until it is rescinded and provided that the child remains in the custody of the adopting parent or parents during the interlocutory period. We recommend the bill's favorable consideration by your committee.

(3) This group of proposals would confer World War I benefits upon certain veterans of Mexican border service who served 90 days or more during the period beginning May 9, 1916, and ending April 6, 1917.

These veterans (and their survivors) who meet prescribed eligibility requirements are presently entitled to benefits provided for members of the Regular Establishment, or as they are sometimes called, peacetime veterans, and their dependents. The most significant new monetary benefits which the proposals would extend to the group concerned are non-service-connected disability pension for the veterans and nonservice-connected death pension for their widows and children.

It has been the long established general policy of the Congress to restrict pension to veterans of war service and their deepndents. Enactment of any of the pending Mexican border proposals would confer special benefits upon a particular group of veterans of peacetime service, and their widows and children. Moreover, it would be discriminatory and precedential as to peacetime veterans generally (and their widows and children) including those who served in recognized campaigns, expeditions and occupations. We accordingly recommend that none of the measures be favorably considered.

(4) The final subdivision consists of a proposal to (a) increase from $1,600 to $2,500 the maximum amount allowed for monetary assistance toward the purchase of an automobile or other conveyance by veterans with certain specified disabilities, and (b) extend this benefit to any person who, after this amendment becomes effective, is on full-time active duty in the Armed Forces (not including active duty training) and is suffering from one of the disabilities specified in 38 U.S.C. 1901 (a), if the disability is the result of an injury incurred or disease contracted in, or aggravated by, active military, naval, or air service "during any period of war or service specified in section 1901."

When the automobile assistance program was established in 1946, the $1,600 maximum payment authorized approximated the actual cost of many automobiles then available together with any special attachments and equipment required for their operation by disabled veterans. Since then the cost of living, and the cost of automobiles, has considerably increased without any adjustment of the maximum amount provided for this assistance. The increase proposed by the pending measure would tend to reestablish, to an effective degree, the comparability which originally existed between the cost of an automobile or other convenance and the monetary assistance provided for its purchase. Under the circumstances, the Veterans' Administration would not object to favorable consideration of this portion of the bill.

Under existing law, certain benefits under programs which we administer, such as educational assistance and home and farm loans are now available to persons in service who are otherwise eligible. We believe that the award of monetary assistance in the purchase of an automobile to such individual would constitute a reasonable and equitable enlargement of this group of benefits. The Veterans' Administration therefore would favor the enactment of this provision.

As drafted, the bill would extend eligibility to any serviceman who suffered the requisite disability as a result of military service, generally, after January 31, 1955. However, should he be discharged before applying for the benefit, the language of the existing law regarding veterans' entitlement as a result of service after January 31, 1955, would require a showing that the disability was incurred "as the direct result of the performance of military duty." Obviously, this discrimination is not intended. Accordingly, we urge that the direct result of the performance of military duty” requirement be eliminated as to those veterans whose disability was incurred during the Vietnam era, thus fully equating them with veterans of World War II and the Korean conflict.

Gentlemen, this concludes the Veterans Administration statement on the pending proposals. My associates and I are available to undertake questions you may desire to ask.

Mr. Dorn. Mr. Wilson, I want to thank you for a very clear and concise statement of the position of the VA. I would like to ask yoll

how much change has there been in the cost of living since we last raised the DIC payments?

Mr. WILSON. Could I ask one of my associates, sir? I think they have this.

Mr. BERNSTEIN. Mr. Chairman, there have been different rates provided for different groups. For example, since the last time the child's rate was raised, I think the cost of living has increased approximately 1112 or 12 percent. Since the parents' last increase, the cost of living has gone up approximately 11.8 percent, similar to children.

The widows' cost of living since the last increase in 1963, the $8 feature as distinguished from military pay, has gone up approximately 19 percent.

Mr. Wilson. I think, too, it should be pointed out that the last increase as I recall it in many of the lower grade categories was only a very small increase for the widows under the DIC program, because it was based on the military pay increase.

Mr. DoRN. Mr. Wilson, could you give the subcommittee any idea when this review might be completed ?

Mr. Wilson. Yes, sir. We are expecting a tape from Internal Revenue Service based on widows' incomes for the period 1967 sometime during the month of September. We are expecting similar information from Social Security sometime during the month of September.

We hope to conclude our study by November.
Mr. DORN. Mr. Montgomery?
Mr. MONTGOMERY. Thank you, Mr. Chairman.

I would like to also follow up on your comments. I thought you gave us a very good and detailed report. As a new member of the subcommittee, I have a lot of work to update myself on pensions and compensation. I have a couple of questions. On page 3, paragraph 3, how did it come about that the widow of a veteran who died of nonservice-connected disability could be receiving $50 a month for aid and attendance, whereas a widow of a service-connected veteran does not. I know Congress must have passed the law, but why would they do anything like that? It looks like preference should be shown to a widow of a serviceconnected death.

Mr. WILSON. As I am sure the chairman would tell you, Mr. Montgomery, the preference of this committee as I recall it has always been for the service-connected man. As I recall it the Congress was considering pension legislation and this particular provision was put into the law during that consideration. I think that is about the extent to which I can comment about it because at the moment they were not considering compensation legislation.

They were considering this particular benefit.

Mr. MONTGOMERY. The counsel says we will consider it. Possibly it should have been the other way around. We should have considered first taking care of the widow of a service-connected death.

What specific bills can you recall that will increase the widow's benefits as pertaining to living cost increases ?

What were your recommendations on that?

Mr. WILSON. H.R. 1621 would provide a $50 increase for widows in need of aid and attendance. If you are speaking to the general increase in widows' benefits, the general DIC, there are a number of those. H.R. 3067, 7461, 5516, 4623, and 6986. I think there are others, too.

Mr. MONTGOMERY. A widow can receive up to $165 per month now.

Mr. Wilson. That would be under one of the bills that is now proposed. A widow receives under the DIC currently existing $120, plus 12 percent of her husband's base pay at current rates. So a widow of a general would receive a substantial amount as opposed to a widow of a private first class who would receive a much lower amount. This is one of the matters, sir, that causes us to want to study the matter some more. Over a period of time since DIC was first placed into effect there have been a substantial number of pay raises in the military. These pay raises have been somewhat disproportionate and as a result the widow who was already getting the most gets a disproportionate amount more. For instance, in the last military pay raise, the widow of the lower grade enlisted man, as I mentioned earlier, only got a $1 or $2 increase and in a couple of instances did not get any increase at all. On the other end some widows now can get up to $457 per month. These would be the widows of a four-star generals who died a serviceconnected death.

Mr. MONTGOMERY. But the widows of recruits could possibly get only what

Mr. Wilson. The minimum is $134.
Mr. MONTGOMERY. Plus 12 percent.

Mr. Wilson. No, this would be $120 plus 12 percent of his base pay which would come to a total of $134.

Mr. MONTGOMERY. You are not making any recommendations for the amount of increase we should consider.

Mr. Wilson. Not until we complete our study, sir, which should be in November.

Mr. MONTGOMERY. Taking one of the average bills in here, how much would that increase cost the Government if we enacted the recommendations.

Mr. WILSON. As I recall one of Mr. Teague's bills, it is somewhere between $30 and $50 million, I think.

Mr. MONTGOMERY. You think between $30 and what?

Mr. Wilson. $30 and $50 million depending on what would be the base factor. Whether the base factor was raised from $120 to the $125 or $130 or $135. I think we have some cost projections that were included in our reports to the committee.

Mr. BERNSTEIN. Yes, that is correct.

One of the bills, as Mr. Wilson pointed out, for example, H.R. 12410 would cost in the first year approximately $1612 million, increasing to approximately $50 million in the 5th

year. Mr. MONTGOMERY. How much percent increase would that be over what they are getting now!

Mr. BERNSTEIN. That is the bill that proposes a $165 minimum rate. It would raise the current formula from $120 a month plus 12 percent of base pay to $130 per month plus 12 percent of base pay, with a minimum payment of $165 per month.

Mr. MONTGOMERY. How much percentage would that be? Would it be 5 percent?

Mr. BERNSTEIN. I do not think you can figure it out percentagewise. There are 200 odd rates payable to widows today.

COUNSEL. The lowest rate is 26 percent.

Mr. MONTGOMERY. What about the Senate bill that has passed the committee and is on the floor for consideration.

Mr. BERNSTEIN. The Senate bill I believe you are referring to is S. 1471, and as introduced that is identical to H.R. 12410, which I mentioned.

At the present time the Senate Finance Committee has ordered the Senate bill favorably reported with amendments. One of the significant amendments would raise the minimum of $165 to $170 a month.

Mr. MONTGOMERY. What is the cost of that bill in total ?

Mr. BERNSTEIN. That bill as they propose to amend it I believe would be estimated at approximately $52 or $53 million the first year.

Mr. MONTGOMERY. What about the 2d and 3d years!
Mr. Wilson. It goes up slightly, sir to about $57 or $58 million.
Mr. BERNSTEIN. I think that is approximately correct.

Mr. MONTGOMERY. Mr. Chairman, that is all I have. I guess you can see by my questions I do have some work to do on pensions and compensation.

Mr. DORN. So do I.

Mr. Wilson. I would like to associate myself with Mr. Montgomery. I too have some work to do.

Mr. Dorn. You certainly have made a beginning with respect to your positions. Are there any questions from the staff ? If not, Mr. Wilson, I want to thank you and your associates. We are just glad to have you with us. Thank you, sir.

Mr. WILSON. Thank you.

Mr. DORN. Our next witness will be Mr. Francis W. Stover, director of national legislative service, Veterans of Foreign Wars of the United States. Mr. Stover, we are always glad to have you before the subcommittee and the full committee. You may proceed in any way you wish.

STATEMENT OF FRANCIS W. STOVER, DIRECTOR, NATIONAL LEG

ISLATIVE SERVICE, VETERANS OF FOREIGN WARS OF THE UNITED STATES

Mr. STOVER. Thank you, Mr. Chairman. I expected Mr. Norman Jones, our national rehabilitation director, to be here, and he may be here shortly.

Mr. Chairman and members of the subcommittee, thank you for the privilege to appear before this distinguished subcommittee to present the position of the Veterans of Foreign Wars on the approximately 50 bills which relate to the dependency and indemnity compensation program.

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