pension. Even the monthly rates of pension, which were last increased in 1964, have not kept pace with the increased cost of living.

This 89th Congress is continually being called upon to vote for social reforms that are designed to improve the financial status of various segments of our population. Even now, the Administration is considering the so-called "reverse income tax" plan that would have the effect of guaranteeing everyone a minimum annual wage of more than $3,000. With this trend continuing, and the cost of living increasing, it is essential that we re-appraise the needs of our nation's aging veteran population.

I have devoted considerable time and effort to a study in depth of this problem. I believe the bill I have introduced to liberalize the veterans' pension program will permit the Federal Government to more adequately discharge its continuing obligation to our nation's wartime defenders and at the same time, recognize its obligation to all citizens as taxpayers.

The measure will increase most of the income limitations that control the monthly rate of pension under existing law. It will establish a new maximum rate of pension and a new minimum income limitation for the most needy veterans. The proposal will, for example, permit the married veteran with income of $500 annually to receive $130 monthly instead of the $105 monthly he is now receiving. It will permit the widow with no children and income of less than $250 to receive $80 monthly instead of the $64 she currently receives.

The proposal will also permit any veteran in receipt of retirement income to waive up to 10% of that retirement income so he may qualify for pension.

A frequent complaint of pensioners is that the income of a working wife is not counted as the veteran's income for pension purposes. When the working wife retires, however, all but $1200 of her retirement income is counted as the veteran's income for pension purposes. Thus, a veteran's pension may be adversely affected at a time when his family income has been substantially reduced. This proposal will correct this situation by excluding all of a spouse's income when she reaches age 62, in computing the veteran's income for pension purposes.

These are the principal provisions of the bill I have introduced. The Committee on Veterans' Affairs, Mr. Speaker, will begin hearings tomorrow on this important subject. I am extremely hopeful that these hearings will result in the reporting of this bill or a similar measure to provide a more generous pension program for the nation's sick and needy veterans and widows.

A section by section analysis of H. R. 16247 follows.

ANALYSIS OF "VETERANS' PENSION ACT OF 1966"

(Introduced by Honorable E. Ross Adair July 14, 1966)

This is a bill to increase the rates of pension payable to veterans of World War I, World War II and the Korean Conflict and their widows and to liberalize and make more equitable the provisions of the pension law.

Section 1. This section contains the short title and provides that the Act may be cited as the "Veterans' Pension Act of 1966".

Section 2. This section permits veterans to waive the receipt of not more than 10% of any retirement annuity, including Social Security, administered by an agency of the Federal Government. The Section further provides that 10% of any waived retirement income shall not be considered as income for pension

purposes.

This section also provides that the nominal remuneration received by patients and members in Veterans' Administration hospitals and domiciliaries for services performed as therapeutic and rehabilitative activities, as set forth in Section 618 of Title 38, shall not be counted as income for pension purposes.

Section 3. This section revises the income limitations controlling the monthly rate of pension for veterans and widows. The existing pension rates are increased by approximately five percent.

The section adds a new monthly rate of $125 for veterans with no dependents having incomes of less than $250 annually and a monthly rate of $130; $135; or $140 for veterans with one, two, or three or more dependents respectively and having incomes of less than $500 annually.

A new monthly rate of $80 for widows with no dependents having incomes of less than $250 annually and a new monthly rate of $100 for widows with dependents having incomes of less than $500 annually are also provided by this section.

Section 4. This section removes the requirement that a veteran who has attained the age of sixty-five must have a 10% disability and that his unemploy

ability be attributable thereto. These veterans would, of course, continue to be required to meet the service, income, and discharge requirements of existing law. Section 5. This section clarifies and liberalizes the criteria for entitlement to the additional $35 monthly pension for veterans who are permanently housebound. Section 6. This section provides that none of a spouse's income, in the case of a spouse who is sixty-two years of age or older, shall be counted as the veteran's income for pension purposes. Under existing law, a spouse's earned income or $1,200, whichever is greater, is not counted for pension purposes, irrespective of the age of the spouse.

Section 7. This section will permit veterans who are entitled to special monthly compensation for the service connected loss of a limb or certain other disabilities and who are also entitled to non-service connected pension benefits to receive the pension concurrently with the special monthly compensation.

Section 8. Under existing law, veterans with less than ninety days of wartime service are entitled to pension only if they are separated for service connected disability. The Veterans' Administration has held that service connection established by certain legal presumptions in such cases is not sufficient to establish entitlement to pension. This section will clarify the language so that service connection established by the "presumption of soundness at enlistment" doctrine as set forth in Section 311 of Title 38, United States Code, shall be sufficient to meet the service connected disability requirement for entitlement to pension in cases of less than ninety days service.

Section 9. This is the effective dates section and provides that Sections 2 and 6. shall be effective January 1, 1967, while all other sections are effective on the first day of the third calendar month after date of enactment.

Mr. DORN. We are glad to have with us this morning our distinguished colleague, Bob Dole.

STATEMENT OF HON. ROBERT DOLE, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF KANSAS

Mr. DOLE. Mr. Chairman, I appreciate this opportunity to testify in support of several bills pending relating to veterans' pensions. For the committee's information, I have served in the capacity of service officer for the American Legion and the VFW and am a member of the Disabled American Veterans and other veterans' organizations. I think I understand basically some of the problems as well as some of the suggested solutions. I recognize, of course, that some of these things that are very desirable cannot be achieved because of certain funding limitations.

My initial comments are directed to H.R. 7903, introduced on May 5, 1965, and H.R. 12123, introduced on January 18, 1966.

H.R. 7903 provides that where the entitlement of a veteran, widow, or child to a pension from the Veterans' Administration is based upon the veteran having served in World War I, the beneficiary shall, if otherwise eligible, have the right to elect payment of pension under either the provision of title 38, as in effect on June 30, 1960, or as amended by the Veterans' Pension Act of 1959, whichever provides the greater benefit.

H.R. 12123 would amend the United States Code, in order to increase by 20 percent the income limitations imposed by chapter 15 of title 38 on persons entitled to pensions thereunder.

have

More than 150 bills relating to nonservice pensions in some way been introduced and referred to your committee. This is certainly a clear indication of the sentiment in Congress that something should be done in this area.

The average age of veterans of World War I is above 70 years, and their ranks are diminishing rapidly. Hundreds of these veterans are

almost entirely dependent on this income for a living. Everyone is aware of the effects of the cruel hand of inflation on those living on a limited fixed income. Veterans in receipt of pensions have enjoyed no immunity from the increase in living costs, which unfortunately threaten to go even higher.

My reason for introducing H.R. 7903 is that many veterans of World War I who had not reached the age of 65 on July 1, 1960, were arbitrarily forced to accept the provisions of Public Law 86-211. Under these circumstances, such veterans whose spouses passed away would have their pensions reduced considerably. Many World War veterans feel the younger group should have the right to elect to receive benefits under whichever law would give them the higher benefits or be of more advantage to them.

It was my objective in introducing H.R. 12123 to rectify an injustice resulting to approximately 29,000 veterans whose pensions have been reduced as a result of the modest social security increase voted by Congress last year.

Mr. Chairman, in most instances, these veterans received a social security annuity which placed them slightly under one of the income limits established by law for entitlement to a certain rate of pension. When the social security increase, though slight, was approved, it was sufficient to put the veteran in a higher income bracket, thus reducing or terminating his payments. Though the amount varied with the individual case, I understand that each of the 29,000-odd veterans concerned lost considerably more in pension than he gained in social security. In a typical case coming to my attention, the veteran received a monthly increase of $8 in social security, while losing $48 in veterans' pension benefits.

H.R. 12123 would permit a modest increase in income without affecting pension entitlement. It would do this by increasing by 20 percent the income limitations for each category in chapter 15 of title 38, United States Code relating to persons entitled to pensions thereunder.

Arguments are made that during the 88th Congress a 10-percent retirement income exclusion for pension purposes was authorized and that the pensioner is receiving more in pension than he did in 1964. Nonetheless, the fact remains that their pension payments for 1966 have been substantially reduced from the rate received in 1965.

In addition, these veterans and their dependents, and for that matter all Americans, watch helplessly as the dollar value continues to erode. Pensioners and others on limited fixed incomes have been particularly injured by the rising cost of life's necessities. These persons are the victims of spending policies of this administration-resulting inflation has been given as the basis for requested wage increases for Federal employees as well as for persons employed in private industry. In the case of Federal workers, Congress has recognized the need for cost-of-living adjustments and passed legislation from time to time to compensate for the rising costs of living. Congress, therefore, cannot in good conscience delay action on bills relating to liberalization of veterans' pensions.

As a disabled veterans, who served as service officer for the American Legion and VFW for a number of years, it is my belief that our primary obligation is to assist the low-income veteran, the seriously disabled, and widows and children of deceased veterans.

It is my hope the committee will seriously consider H.R. 13499, introduced by Congressman Haley, a member of this committee. I know of a number of veterans in my district, and other parts of Kansas, who have been denied pension benefits because of requirements that certain payments, from various sources, be considered as income under section 521, title 38, United States Code. H.R. 13499 would amend section 521 of the United States Code to exclude from income consideration of all payment from any source when a veteran reaches age 72.

If the committee feels H.R. 13499 goes too far, then at least Mr. Haley's suggestion could be used as a basis for revising present laws, therefore reducing discrimination against countless veterans. I would agree that benefits should be made available primarily to those in need but at the same time Congress should not penalize those veterans who, because of accident or design, may have accumulated a reasonable amount of property, or who may receive certain retirement or annuity payments, or other income, because of prior employment. With all the emphasis these days on improving standards of living in the country, and around the world, it would seem to me that veterans of our Nation's wars should be given first consideration. It seems reasonable that income should not be a factor in determining pension eligibility after age 72 in the same manner as income is not a factor in social security after age 72. I am not suggesting pension benefits be made available to so-called wealthy veterans, but am insisting that Congress adopt a more realistic attitude in determining eligibility.

It has always been, and still is, my contention that any veterans pension program should confer benefits on the aged, needy veterans, their widows, and the children of deceased veterans. The problem in the past, as well as now, appears to be interpretation of the word "needy," which should perhaps be changed to "deserving" to avoid the interpretation that to be eligible a veteran must be living in poverty. Specifically, I would urge and recommend that any bill reported by your committee include the following:

1. Increase certain income limits and pension rates for veterans and widows.

2. Eliminate the disability requirement for entitlement to pension at age 65.

3. Serious consideration be given to reducing the 90-day service requirement; and

4. Eliminate all payments from any source as income when veteran reaches age 72.

In closing, Mr. Chairman, I wish to express the hope the committee may take action to favorably bring about the long overdue adjustments. Thank you.

Mr. DORN. Do you have any specific recommendation to the subcommittee as to just how many days should be required for eligibility for people in World War I, if not 90 days?

Mr. DOLE. I realize we should have a cutoff date and this perhaps is a valid argument, but it seems to me where a man has either been enlisted or was drafted and shows every indication that he has tried to carry out his patriotic duty, that he should not be penalized because he was separated before serving 90 days. As far as I am concerned, a man who served any time in the service of his country and then who

is honorably discharged is a veteran and I think he should be a veteran for all practical purposes and for all purposes under the law.

At one time I knew the cost of eliminating completely the 90-day requirement. I don't remember what it is, but I know it is significant. At the same time, when a man enlists or goes into the service, he is willing to accept the risks involved and doesn't seek special favors. It seems to me that by placing an arbitrary 90-day limit, making him ineligible for benefits, we do an injustice to many, many needy and deserving veterans. But I would leave to the discretion of the committee, just where the line should be drawn.

Mr. DORN. Are there any questions on my left?

Mr. TEAGUE of California. Mr. Chairman, I would like to say this: We are all grateful to Mr. Dole, particularly in view of his distinguished war record, and his experience as a service officer, for having come before us today and having some very reasonable and constructive suggestions.

Mr. ADAIR. In a bill which I recently introduced, we have done something about this 90-day provision.

As you know, the Veterans' Administration has held that service connection established by certain legal presumptions, in cases of less than 90-day service, is not sufficient to establish entitlement to pension. A proposal which I have in my bill would clarify the language in his section of existing law to say that service connections established under the "presumption of soundness at time of enlistment” provision of the law shall be sufficient to cause entitlement to pension in cases of less than 90 days' service. That would go at least in part to the point you made.

Mr. DOLE. That would be a great improvement. I think it is a reasonable request and I hope you get it to the House floor.

Mr. ADAIR. In other words, the 90-day rule applies in one case and doesn't apply in the other case.

Mr. DOLE. That is right, but I think it does work a hardship. Of course, I recognize the cost involved, and we probably can't do what the committee would like to do. I realize it is not the committee that is reluctant to do this thing. It is just that we are taking a realistic look at what the cost may be. There are many veterans, however, I believe, who are more or less penalized because of it.

Mr. DORN. Mr. Dole, I would like to add my words of appreciation to that of Mr. Teague and others, that we are delighted to have you spend this time with us because of your experience in this field and because of your combat service.

Thank you very much.

STATEMENT OF HON. CLAUDE PEPPER, A REPRESENTATIVE IN CONGRESS FROM THE STATE OF FLORIDA

Mr. PEPPER. I am most gratified to testify today before a committee which has done more than any other to bring deserved benefits to our veteran population. I would like, first, to urge passage of my own bills which are designed to correct specific inequities in the veterans' pension program. Second, I will once again add my voice to those urging an overhaul of the veteran's pension program to put its benefits in line with the rising cost of living and the rising standard of living.