Question Period Note: LAPSED FUNDING

• Veterans’ benefits and services are demand-driven; so Veterans Affairs’ funding model guarantees that funds authorized specifically for these benefits and services are always available to our Veterans, no matter how many Veterans come forward and when.
• Veterans Affairs Canada’s top priority is to help Veterans. Over 90% of the department’s budget funds Veterans’ programs, benefits and services, $5.6 billion last year alone.
• Between 2015-2016 and 2023-2024, Veterans Affairs Canada experienced a 78% increase in the number of applications received for disability benefits.
• To keep up with the rise in demand and ensure that Veterans get services and benefits when they need them, over $11 billion has been invested for Veterans since 2016.

On 5 November 2018, the following motion by MP Gord Johns (Courtenay – Alberni) was discussed for Opposition Day:
“That, in the opinion of the House, the government should automatically carry forward all annual lapsed spending at the Department of Veterans Affairs to the next fiscal year, for the sole purpose of improving services for Canadian veterans, until the Department meets or exceeds its 24 self-identified service standards.”
Veterans Affairs Canada supported this motion and the rationale was as follows:
This motion alone would have minimal impact on back logged applications.
The Government already does this for quasi-statutory programming. Money returned to the consolidated revenue fund (lapsed) for quasi-statutory programming is accessible the next year to fund Veterans programming based on demand. This is how “quasi-statutory” program authority works. Veteran programs/services are funded based on need regardless of when the Veterans come forward to receive the benefit.
Additional Information:
Lapsed Funding 2023-24 is $51.6M – approximately $44M (85%) are program funds and the remaining (15%) are operational funds
• 85% of the 2023-24 lapsed or unspent funds are a quasi-statutory expenditure authority approved by Parliament to cover the costs of Veterans benefits and services.
• The Department has no authority to spend these funds for any other purpose thereby safeguarding these funds and ensuring they are available whenever a client comes forward and is deemed eligible.
• The remaining 15% of the 2023-24 unspent funds were approved by Parliament to cover our Departmental operating costs and these unspent funds were made available in fiscal year 2024-25 through standard funding mechanisms available to Departments.
• Therefore 100% of the $51.6M unspent funds are still available to spend when needed.
Lapsed Funding - 2022-23 ($272M – approximately $260M (95%) are program funds and the remaining (5%) are operational funds)
• 95% of the 2022-23 lapsed or unspent funds are a quasi-statutory expenditure authority approved by Parliament to cover the costs of Veterans benefits and services.
• The Department has no authority to spend these funds for any other purpose thereby safeguarding these funds and ensuring they are available whenever a client comes forward and is deemed eligible.
• The remaining 5% of the 2022-23 unspent funds were approved by Parliament to cover our Departmental operating costs and these unspent funds were made available in fiscal year 2023-24 through standard funding mechanisms available to Departments.
• Therefore 100% of the $272M unspent funds are still available to spend when needed.

Q1 – What is the amount of the lapsed funding from last year (23/24)?
Lapsed funding for 2023-24 was $51M
• $10M - Pension for Life Programs
• $2.2M – Disability Pension and Awards Programs
• $30M – Normal amounts of unspent funds in 20 Quasi Stat programs
• $8M – Operating*
• $1.4M – Normal amounts of unspent funds in non-Quasi Stat programs and SPAs
*Although the Operating lapse for 23/24 is $8M, the Operational Budget Carry Forward (OBCF) is $15M due to credits applied in the calculation to reach the maximum carryforward allowable (credits include: paylist expenditures, Supplementary Estimates items absorbed (Manuge), salary overpayment resulting from Phoenix).
Q2 – What is the amount of the lapsed funding from fiscal year 22/23?
Lapsed funding for 2022-23 was $272M
• $150M - Pension for Life Programs where production did not meet projections
• $26M – Disability Pension and Awards Programs
• $81M – normal amounts of unspent funds in 20 Quasi Stat programs
• $13M – Operating Budget Carry Forward
• $2M – Normal amounts of unspent funds in 11 non-Quasi Stat programs