Finally, Mr. President, the bill would provide for peacetime/wartime equalization of rates for those survivors receiving death compensation. Right now there are two programs paying benefits to survivors of veterans who died of serviceconnected conditions. The largest is the current DIC system authorized in 1956 by Public Law 881 of the 84th Congress. A number of survivors of veterans who died prior to January 1, 1957, however, continued to receive payments under the older death compensation program. There are 116,791 survivors who receive benefits under this program. Of that number, 4,453 are classified as "peacetime" survivors by virtue of the deceased veteran's period of service. Under current law they are entitled to death compensation at the rate of 80 percent of that received by survivors of veterans who served during a "wartime" period. The bill before you today would equalize wartime/peacetime disability compensation rates in Public Law 92-328 which I authored in the last Congress. The additional cost of this provision is estimated to be insignificant.

Mr. President, I look forward to quick action on the Survivors Dependency and Indemnity Compensation Act of 1974 as I do on the Veterans Disability Compensation Act of 1974 which I joined in introducing with the distinguished Senator from Georgia, Mr. TALMADGE, today.

[No. 98]

COMMITTEE ON VETERANS' AFFAIRS, U.S. SENATE

VETERANS' ADMINISTRATION,

OFFICE OF THE ADMINISTRATOR OF VETERANS' AFFAIRS,

Hon. VANCE HARTKE,

Washington, D.C., March 12, 1974.

Chairman, Committee on Veterans' Affairs,

U.S. Senate, Washington, D.C.

DEAR MR. CHAIRMAN: We are pleased to respond to your request for a report on S. 3072, 93d Congress, the proposed "Survivors Dependency and Indemnity Compensation Act of 1974".

The bill, effective May 1, 1974, would (a) increase the rates of dependency and indemnity compensation by approximately 16 percent for widows and children of veterans whose deaths were service connected; (b) increase the monthly rates of aid and attendance death compensation by approximately 16 percent for widc ws and dependent parents of veterans who died before January 1, 1957, and whose deaths were service connected; (c) equalize, whether peacetime or wartime, the monthly rates of service-connected death compensation payable for widows, children and dependent parents of veterans who died of service-connected causes before January 1, 1957; and (d) presume service-connected death in the cases of certain veterans who had at the time of death permanent and total service-connected disability.

Section 2 of the bill would provide increased monthly rates of dependency and indemnity compensation for widows, ranging from $213 to $544 as compared with current rates of $184 to $469; and the additional monthly amount for children under 18 would be increased from $22 to $26 for each child. It would also increase the monthly rate of additional dependency and indemnity compensation payable to widows on account of need of aid and attendance to $64 from the current rate of $55. Section 3 would increase monthly dependency and indemnity compensation rates for children (where there is no widow entitled), ranging from $107 for one child to $200 for three children, plus $39 for each additional child as compared with current rates of $92, $133, $172 and $34, respectively. Section 4 proposes increases to $64, $107 and $55, respectively, in the current monthly rates of $55, $92 and $47 of dependency and indemnity compensation payable under 38 U.S.C. 414 to certain children (1) permanently incapable of self-support or (2) over 18 and attending school.

Since the dependency and indemnity program was first established, the Congress has periodically made adjustments in the rates where such were deemed necessary. These rates were last increased for widows and children by Public Law 92-197, effective January 1, 1972. From that date through January 1974, the cost of living, as reflected by the Consumer Price Index, has risen 13.5 percent. The rates of dependency

and indemnity compensation for parents were recently increased, effective January 1, 1974, by Public Law 93-177.

The President, in his letter of March 4, 1974, to your. committee proposed, among other things, a 14-percent increase in dependency and indemnity compensation payable to widows and children, effective March 1, 1974, to conform with the changes since the last dependency and indemnity compensation rate increase, which was effective January 1, 1972. The President further stated that to protect compensation benefits in the future, an automatic adjustment in benefits is needed to recognize future increases in the cost of living, as measured by the Consumer Price Index.

The enclosed draft bill, which has been transmitted to the President of the Senate, would accomplish the recommendation of the President regarding dependency and indemnity compensation, as well as those regarding disability compensation contained in his letter of March 4, 1974. This measure would cost approximately $432 million the first year, decreasing to approximately $430 million the fifth year.

We believe that the enactment of the enclosed draft bill will in the long run be more beneficial to the survivors of veterans whose deaths are service connected than would S. 3072. Accordingly, we oppose enactment of sections 2, 3, and 4 of S. 3072, and urge that in lieu thereof the committee favorably consider the enclosed draft bill.

Section 5 of the bill would provide increased monthly rates of aid and attendance death compensation for widows and dependent parents by approximately 16 percent.

Section 6 provides for payment of the same monthly death compensation rates to survivors of veterans whose deaths were service connected during peacetime as are paid for wartime deaths where the death occurred prior to January 1, 1957. Currently, peacetime death compensation is payable at only 80 percent of the rates for wartime deaths..

Under the provisions of 38 U.S.C. 321 and 341, death compensation is authorized for service-connected deaths occurring prior to January 1, 1957. Chapter 13 of title 38, United States Code (dependency and indemnity compensation) restates a portion of the Servicemen's and Veterans Survivors Benefits Act (Public Law 881, 84th Cong., Aug. 1, 1956). This act established a new and modernized benefits program of dependency and indemnity compensation for survivors of veterans dying from service-connected causes on or after January 1, 1957.

Survivors of veterans who died of service-connected causes before January 1, 1957, and were entitled to death compensation may elect to receive the new benefits or may continue to receive death compensation. The authority to continue on the death compensation rolls was undoubtedly provided to preclude a reduction of monetary benefits which could have resulted in some instances if dependency and indemnity compensation had been made the exclusive program. We see no justification for enhancing this advantage of the protected group through increasing or equalizing rates as proposed by S. 3072. Moreover, although an election to receive dependency and indemnity compensation in lieu of death compensation may be made at any time, once it is validly made it is irrevocable. It appears from the election provision that the Congress contemplated death com

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pensation would become a declining program. We doubt that it was intended that such benefits would thereafter be increased or extended. An increase in death compensation rates would be a distinct departure from the outlined concept. Accordingly, we oppose the enactment of sections 5 and 6.

Under section 7 of S. 3072, certain non-service-connected deaths would be conclusively presumed service connected if the veteran (a) was discharged or retired for a service-connected disability permanent and total in nature, and at the time of his death was in receipt of or entitled to receive compensation for a service-connected disability permanent and total in nature; or (b) had been in receipt of or entitled to receive compensation for a permanently and totally serviceconnected disability for 20 or more years. Such presumption of service connection would be specifically inapplicable where death occurred as a result of accidental causes having no relationship to the serviceconnected disability.

Where service-connected disability is found to be the principal or contributory cause of death, such death is considered to be service connected. These determinations are made on a very liberal basis. For example, there are disabilities which by their very nature are so overwhelming that eventual death can be anticipated irrespective of coexisting conditions. Even though such disabilities are non-serviceconnected and the primary cause of death, consideration is given as to whether the coexisting service-connected conditions were of such severity as to have a material influence in accelerating death. Where death has been so accelerated, it will be considered service connected. The proposal would thus place the survivors of certain veterans who die of a non-service-connected cause on a parity with the survivors of veterans who die of an actually service-connected cause. In the cases of war service veterans, the bill would have the liberalizing effect of providing (a) greater benefits for widows and children with no requirement as to need, and (b) basic eligibility of parents for benefits where none now exists. In the cases of veterans of peacetime service, the bill would provide basic eligibility for widows, children and parents for monetary death benefits where none now exists.

The Veterans' Administration believes that existing law and regulations provide very liberal and equitable conditions for determining that death is service connected. Moreover, there is no justification for presuming a death to be service connected when the evidence does not support such a finding. We therefore oppose enactment of section 7. The estimated cost of enactment of S. 3072 approximates $95.4 million the first year, gradually increasing to $101.5 million the fifth

year.

In summary, we oppose enactment of S. 3072 for the reasons set forth above and urge, in lieu thereof, that the committee favorably consider the enclosed draft bill.

Advice has been received from the Office of Management and Budget that there is no objection to the presentation of this report from the standpoint of the administration's program.

Sincerely,

Enclosure.

DONALD E. JOHNSON,
Administrator.

A BILL To amend title 38, United States Code, to increase rates of disability compensation and dependency and indemnity compensation, and to provide for automatic adjustment thereof commensurate with future increases in the cost of living, and for other purpose

Be it enacted by the Senate and House of Representatives of the United States in Congress assembled, That (a) section 314 of title 38, United States Code, is amended

(1) by striking out "$28" in subsection (a) and inserting in lieu thereof "$31";

(2) by striking out "$51" in subsection (b) and inserting in lieu thereof "$57";

(3) by striking out "$77" in subsection (c) and inserting in lieu thereof "$86";

(4) by striking out "$106" in subsection (d) and inserting in lieu thereof "$119";

(5) by striking out "$149" in subsection (e) and inserting in lieu thereof "$167";

(6) by striking out "$179" in subsection (f) and inserting in lieu thereof "$200";

(7) by striking out "$212" in subsection (g) and inserting in lieu thereof "$237";

(8) by striking out "$245" in subsection (h) and inserting in lieu thereof "$274";

(9) by striking out "$275" in subsection (i) and inserting in leiu thereof "$308";

(10) by striking out "$495" in subsection (j) and inserting in lieu thereof "$554";

(11) by striking out "$616" and "$862" in subsection (k) and inserting in lieu thereof "$690" and "$965", respectively;

(12) by striking out "$616" in subsection (1) and inserting in lieu thereof "$690";

(13) by striking out "$678" in subsection (m) and inserting in lieu thereof "$759";

(14) by striking out "$770" in subsection (n) and inserting in lieu thereof "$862";

(15) by striking out "$862” in subsections (0) and (p) and inserting in lieu thereof "$965";

(16) by striking out "$370" in subsection (r) and inserting in lieu thereof "$414"; and

(17) by striking out "$554" in subsection (s) and inserting in lieu thereof "$620".

(b) The Adininistrator of Veterans' Affairs may adjust administratively, consistent with the increases authorized by this section, the rates of disability compensation payable to persons within the purview of section 10 of Public Law 85-857 who are not in receipt of compensation payable pursuant to chapter 11 of title 38, United States Code.

SEC. 2. Section 315(1) of title 38, United States Code, is amended

(1) by striking out "$31" in subparagraph (A) and inserting in lieu thereof "$35";

(2) by striking out "$53" in subparagraph (B) and inserting in lieu thereof "$59";

(3) by striking out "$67" in subparagraph (C) and inserting in lieu thereof "$75";

(4) by striking out "$83" and "$15" in subparagraph (D) and inserting in lieu thereof "$93" and "$17", respectively;

(5) by striking out "$21" in subparagraph (E) and inserting in lieu thereof "$24";

(6) by striking out "$36" in subparagraph (F) and inserting in lieu thereof "$40";

(7) by striking out “$53" and "$15" in subparagraph (G) and inserting in lieu thereof "$59" and "$17", respectively;

(8) by striking out "$25" in subparagraph (H) and inserting in lieu thereof "$28"; and

(9) by striking out "$48" in subparagraph (I) and inserting in lieu thereof "$54".

SEC. 3. (a) Chapter 11 of title 38, United States Code, is amended by adding at the end thereof the following new section: