Evaluation of the RCMP Survivor Income Plan (SIP)

Final Report: February 21, 2014

This report has been reviewed in consideration of the Access to Information and Privacy Acts. The published information is UNCLASSIFIED.

Table of Contents

• Acronyms/Definitions
• Executive Summary
• 1.0 Introduction
  • 1.1 Background
  • 1.2 Purpose and Scope of the Evaluation
  • 1.3 Methodology and Approach
  • 1.4 Considerations and Limitations
• 2.0 Findings
  • 2.1 Relevance
  • 2.2 Performance - Effectiveness
  • 2.3 Performance - Efficiency and Economy
• 3.0 Conclusion
  • 3.1 Relevance
  • 3.2 Performance
• 4.0 Management Response and Action Plan
  • 4.1 Management Response
• Appendix A: Evaluation Framework for the Pensions under the RCMP PCA & SIP
• Appendix B: Bibliography
• Footnotes

Acronyms/Definitions

CHRO

Chief Human Resources Officer

CPP

Canada Pension Plan

DPR

Departmental Performance Report

NCS

National Compensation Services

NPES

National Program Evaluation Services

PCA

Royal Canadian Mounted Police Pension Continuation Act

PAA

Program Alignment Architecture

PAC

Pension Accountability Committee

PFOC

Pension Finance Oversight Committee

PWGSC

Public Works Government Services Canada

QPP

Quebec Pension Plan

RCMP

Royal Canadian Mounted Police

RCMPSA

Royal Canadian Mounted Police Superannuation Act

RPP

Report on Plans and Priorities

SIP

Survivor Income Plan

TB

Treasury Board

VAC

Veteran Affairs Canada

VRAB

Veterans Review and Appeal Board

Executive Summary

What We Examined:

The evaluation the RCMP Survivor Income Plan (SIP) transfer payment program was conducted by National Program Evaluation Services between September 2013 and January 2014. The purpose of the evaluation was to assess the relevance and performance of the transfer payment program against its stated objective to provide for the maintenance of income for the survivors of members who had a duty related death at a level comparable to when the member was still living.

The evaluation was national in scope and payments to eligible recipients ranged from $1.6 million to $2.2 million yearly for a total of approximately $14 million over a seven year period (2005 - 2012).

The evaluation examined monitoring and oversight activities within the RCMP and focused on the relevance and performance of the transfer payment program against its objective.

Why it is important:

The transfer payment program supports the organization's strategic outcome of "Incomes are secure for RCMP members and their survivors affected by disability or death". Additionally, SIP supports the organization's mandate to protect income levels of survivors of regular and civilian members whose deaths were determined to be duty related. In 2012-13, SIP made up approximately 1.5% of all transfer payment programs in the RCMP.

The cost of the SIP and the number of recipients has remained somewhat stable and barring any unforeseen events which would result in multiple deaths, it is expected to remain reasonably stable.

What We Found:

• There is a continued need for the transfer payment program. The mandate is relevant and aligned with the RCMP and Government of Canada priorities.
• Roles and responsibilities of the RCMP Program areas (National Compensation Services and Finance), Veterans Affairs Canada (VAC) and Morneau Shepell (MS), the private third-party administrator of the transfer payment program, are clear.
• The transfer payment program has strong processes and criteria in place and is achieving its objective of providing for the maintenance of income for the survivors of members who had a duty-related death at a level comparable to when the member was still living.

Recommendations:

Given all indications are that the SIP is being managed in an efficient and effective manner, no recommendations are required.

1.0 Introduction

This report presents the results of the Evaluation of the RCMP Survivor Income Plan (SIP) transfer payment program. The evaluation was conducted by National Program Evaluation Services between September 2013 and January 2014. The evaluation was conducted in compliance with Section 42.1 of the Financial Administration Act that requires that all ongoing transfer payment programs are evaluated every five years. The evaluation followed the Treasury Board (TB) Policy on Evaluation and the TB Secretariat's Directive on the Evaluation Function.

1.1 Background

Program Profile and Funding

The SIP was created as a result of the TB authorization received in 1980 to provide benefits for members "killed on duty". In 1987 the SIP was amended to include "duty related deaths" and in 2007 the following two transfer payment programs were consolidated into SIP:

• Pensions to families of Members of the Force Who Have Lost Their Lives While on Duty
• Payments in the Nature of Workers' Compensation to Survivors of Members of the Force Who Have Lost Their Lives While on Duty

The objective of the SIP is to provide for the maintenance of income, at a level comparable to when the member was still living, for the survivors of members who had a duty-related death. In order to be eligible for benefits, the following criteria must be met:

1. The member must have been a serving member at the time of his/her death. ^{Footnote 1}
2. The member's death must have been deemed duty-related (or as a result of a duty-related incident) as determined by VAC in accordance with the Pension Act.
3. The applicant must be a spouse or child eligible for an award under the Pension Act.

The amount received is dependent upon the number of eligible survivors. Entitled spouses are paid benefits for life, while eligible children receive benefits until the age of 18 or 25 if they are full time students.

The SIP is intended to compensate survivors for the difference between the net pay (or pension) the deceased member would have received and the total survivor benefits payable under the following:

• RCMP Superannuation Act or RCMP Pension Continuation Act;
• Canadian Pension Plan (CPP) or Quebec Pensions Plan (QPP); and the
• Pension Act.

NCS is responsible for the overall management of SIP, however the day to day administration is contracted to a third party administrator, Morneau Shepell (MS). VAC's role is to make a determination if a member's death is duty related.

NCS is made aware of a member's death by the Commanding Officer of the Division where the death occurs. NCS then signals the death to MS which subsequently reaches out to the survivor(s) through an initial letter and information package. This correspondence contains information on what services and benefits, including the SIP, are available. The letter further explains the application process as well as the role and responsibilities of both VAC and MS.

VAC's role is to make the determination as to whether or not an RCMP's member's death is duty related in accordance with the provision of the Pension Act. In the event that there are any disagreements regarding the eligibility of the survivor to the SIP, there is an appeal and complaint process through the Veterans Review and Appeal Board (VRAB).

Once the survivor applies for the Pension Act benefits and the death is deemed duty related, VAC notifies the RCMP. The RCMP then provides MS, who administers the SIP on its behalf, with salary information required to calculate the SIP benefits. MS sends out a second letter outlining the specific information the survivor is required to provide in order to complete the SIP application. MS calculates the initial benefits entitlements and subsequently monitors each account and make adjustments based on an indexation factor, changes to tax rates and exemptions, CPP/QPP, etc. on a yearly basis.

RCMP has staff available to assist in resolving any outstanding issues between recipients and/or VAC and MS. Both VAC and MS have call centres in order to answer questions and concerns as well as to provide information to recipients at all stages of the process. Payment to the recipients is made by the RCMP through the Public Works Government Services Canada's (PWGSC) Standard Payment System.

Table 1 provides a breakdown of VAC rulings of "Duty Related Deaths" from January 1, 2009 - December 31, 2013.

Data Source: VAC data extract January 2014
Provided by RCMP Liaison Officer to VAC

As depicted in Table 2, over the last several years, the total payments and number of recipients has remained reasonably stable. Barring any unforeseen events which result in multiple duty related deaths, it is anticipated that both the number of recipients as well as the total amount paid will not fluctuate significantly.

Source: Document received from NCS on 2013-07-23

According to the RCMP's Report on Plans and Priorities (RPP) ^{Footnote 2}, the SIP represents approximately 1.5% of the $163.5 million of planned spending for the RCMP's 2013-2014 transfer payment programs.

1.2 Purpose and Scope of the Evaluation

The evaluation was national in scope and covered the period beginning April 1, 2005 and ending March 31, 2013.

The objectives of the evaluation were to assess:

1. Relevance of the transfer payment program, specifically:
   • A continued need for the transfer payment program:
   • Alignment of the transfer payment program with RCMP strategic objectives and Government of Canada priorities; and the
   • Alignment and clarity of roles and responsibilities as they pertain to the transfer payment program;
2. Performance of the transfer payment program in terms of:
   • Effectiveness - the extent to which the transfer payment program is achieving its expected objective. The evaluation will also examine whether there are oversight and reporting mechanisms to support the management of the transfer payment program.
   • Efficiency and economy - the extent to which the RCMP achieved efficiencies in the management and administration of transfer payment program for the department.

1.3 Methodology and Approach

The evaluation followed the TB Policy on Evaluation and the TB Secretariat's Directive on the Evaluation Function. Multiple lines of evidence were used to assess the relevance and performance of the transfer payment program, and develop findings and recommendations.

Document Review

Internal and external documentation as well as secondary research were reviewed to gather contextual information about the transfer payment program and to inform the evaluation questions. Document review included, Departmental Performance Report (DPR), RPP, benchmarking documents, operational documentation, policies, evaluations, audits and other applicable information.

Analysis of Administrative and Performance Data

Available financial, administrative, and performance measurement data from the RCMP, VAC and MS (where appropriate) was analyzed to inform the evaluation about the efficiency, effectiveness, and economy of the transfer payment program.

Key Informant Interviews

Four interviews were conducted to validate and supplement information gathered through the other lines of evidence indicated above. The interviews were conducted with representatives of both program areas involved with the transfer payment program, including:

• Human Resources - National Compensation Services (n=3)
• Corporate Management and Comptrollership - Corporate Budgeting (n=1)

1.4 Considerations and Limitations

With respect to the SIP, the determination of a "duty related death" is the responsibility of VAC. It was beyond the scope of this evaluation to examine qualifying criteria, processing, adjudication, and administration and management practices that VAC has in relation to this transfer payment program. Additionally, no interviews were conducted with representatives from either VAC or MS.

All information from VAC and MS was received through the RCMP Program area. Some of the information (i.e. services to clients, client satisfaction) extracted from benchmarking reports is reported in aggregate and therefore it was not possible to report information specific to the SIP.

2.0 Findings

2.1 Relevance

All lines of evidence support a continued need for the SIP. Program data shows that there has been a consistent number of SIP recipients over the last seven years varying from 107 to 144 (Graph 1). It is expected that this number will continue to remain stable barring an unforeseen event which would result in multiple duty related deaths.

Graph 1: Number of SIP Recipients by year

Description of graph in tabular format follows.

Source: Details of SIP Payments document
Provided by Pension Accounting Unit, Corporate Management and Comptrollership on 2013 07 23

All interviewees (4/4) agree that there is a continued need for the SIP. Most interviewees (3/4) explained that the SIP is a parallel program to Workers Compensation and other programs offered by Law Enforcement Agencies. RCMP employees are not eligible for these programs therefore the intent of the SIP is to provide survivors with comparable benefits as offered to non-RCMP survivors. Additionally, some of the interviewees (2/4) expressed that the SIP needs to continue as the nature of police work is inherently dangerous and survivors should be provided with income protection to ensure that they are not disadvantaged.

The objective of the SIP is directly aligned with the RCMP Program Activity Alignment (PAA) strategic outcome of "Incomes are secure for RCMP members and their survivors affected by disability or death" ^{Footnote 3}. Additionally, the objective of SIP is linked to the Government of Canada priority of "Income Security & Employment for Canadians".

Part II (Section 32) of the RCMPSA states that "a member of the Force is entitled to an award, adjudicated in accordance with the Pension Act, in respect of injury which resulted in a disability or death, provided the injury arose out of or was directly connected with the member's service in the force" ^{Footnote 4}.

The Pension Act is the legislative authority guiding VAC when making these determinations. Part IV of the Pension Act speaks to the Minister of Veteran's Affairs obligations to make rulings on "duty related deaths" ^{Footnote 5}.

The RCMP Administrative Manual Section II.8.4.2 identifies the legislative authority as the Pension Act for the determination of a duty related death. Additionally, this section within the policy articulates the roles and responsibilities of the RCMP and VAC. The RCMP policy specific for the SIP is found within Admin Manual II.8.5 which outlines information on responsibility for determination and calculations of benefits ^{Footnote 6}.

The governance of the SIP and the responsibilities of the RCMP, MS and VAC are articulated in a number of documents including contracts, MOUs and a series of comprehensive "Business Processes" and "Business Rules". Interviewees indicated that they have a clear understanding of the roles and responsibilities with respect to the management and administration of the SIP.

The contract (and accompanying Annexes and Appendices) between the RCMP and MS provide detailed explanations on the RCMP's and MS' responsibilities in regards to the administration and management of the SIP. Additionally, section 3.1 of the MOU between the RCMP and VAC signed in 2002 ^{Footnote 7} outlines VAC's obligations in accordance with Part II of the RCMPSA. Part II of the RCMPSA provides that "a member of the Force is entitled to an award, adjudicated in accordance with the Pension Act, in respect to injury which resulted in a disability or death, provided the injury arose out of or was directly connected with the member's service in the Force" ^{Footnote 8}. Part IV of the Pension Act outlines that the Minister of Veteran's Affairs holds the obligation to make these decisions/rulings ^{Footnote 9}.

A review of the "Business Process" and "Business Rules" documents further support the clear identification of roles and responsibilities. These documents provide explicit explanations for all aspects of the SIP including processes, criteria and roles and responsibilities for VAC, the RCMP and MS.

The RCMP Administration Manual Section II.8.4.2 and II.8.5 articulate the roles and responsibilities of the RCMP and VAC. ^{Footnote 10}

The following indicates the internal governance and roles and responsibilities of the specific areas within the RCMP involved in the transfer payment program:

• Pension Services of National Compensation Services (NCS) is responsible for overall management of SIP including oversight of MS contractual obligations.
• Corporate Management & Comptrollership is responsible for entering the transfer payment program into the financial system as well as seeking funding from the Treasury Board of Canada for all RCMP transfer payment programs.

2.2 Performance - Effectiveness

Existing documentation provides clear explanations of the processes and criteria guiding the delivery and payments of benefits to recipients.

Admin Manual II.8.5 articulates policies and criteria with respect to the SIP. Outlined in this policy is information about determination and calculation of benefits ^{Footnote 11}. Both document reviews and confirmation by interviewees, indicate that the portfolio of "Business Rules" and "Business Processes" provide detailed and clear processes and criteria which serve to guide the administration of management of the SIP.

Processes and criteria are explained to survivors through an initial letter they receive from MS. This letter provides comprehensive information about the benefits, including the SIP that they may be entitled to. Section 11 within this letter contains specific information related to the SIP and outlines requirements to apply ^{Footnote 12}. The letter encourages the survivor to make contact with VAC in order to initiate the process of determination as to whether the member's death was deemed "duty-related". Once all necessary information is received, VAC has a service standard of 16 weeks (112 days) to process and render a determination on whether the member's death is duty related. Performance information received from VAC (Table 3) suggests that with the exception of 2010, VAC has consistently been meeting the established service standards ^{Footnote 13}.

Data Source: VAC data extract January 2014
Provided by RCMP Liaison Officer to VAC

Once a favourable determination is made by VAC, MS provides the survivor with further information on the process and criteria to continue with the SIP application. Interviewees identified a risk associated to the current process as it is the complete responsibility of the survivor to provide the required information to MS in order to receive benefits under the SIP. There have been instances where survivors have been very slow or in some cases have not provided the required information. As an example, it was explained that this year there were a number of eligible survivors who had not provided the required documentation to MS in order to initiate payments. This resulted in a delay or no payments being made. As a result of discussions between the RCMP and MS, further steps have been added to the process in order to mitigate these incidents. This includes contacting and following up with the potential SIP recipients. As a result of these refinements, all eligible recipients were contacted and provided with the information and "encouragement" needed to seek benefits under the SIP. Situations such as these will have a direct impact on the MS and the RCMP's ability to process and subsequently make payment to the survivor within established service standards.

The SIP is achieving its goal of maintaining comparable income levels for survivors of RCMP members whose death occurred as a consequence of their duties (duty related deaths). All interviewees (4/4) agreed that the SIP is achieving its intended outcome of maintaining comparable income levels of survivors of RCMP members whose death occurred as a consequence of their duties. This is further supported by the benchmarking reports provided by MS which indicate that the service score for paying on time was 100 out of 100 ^{Footnote 14}.

As previously mentioned, one possible risk to achieving the SIP's goal is that there may be some survivors who have not initiated or submitted required information to benefit from the SIP. The Program area is aware of this and has refined processes and enhanced communications in an effort to mitigate this risk.

There is evidence to indicate that there are strong oversight and reporting mechanisms in place with respect to the SIP. Interviewees (4/4) identified the RPP and DPR Supplementary Information (Tables) and Public Accounts of Canada as examples of reporting and oversight which inform Government and the public on its yearly expenditures with respect to the transfer payment program.

Annex A of the contract between the RCMP and MS articulates MS's obligation to provide ongoing reporting of activities ^{Footnote 15}. MS provides performance data that is used in annual benchmarking reports which are commissioned by the RCMP. These reports provide comprehensive accounting of their activities in relation to all RCMP pension programs they administer on behalf of the RCMP including the SIP. A review of these documents suggests that MS overall is providing adequate services to RCMP clients. However, it is important to note that the benchmarking documents report on all Pension programs in aggregate and therefore it is difficult to extract and comment on specific services related to SIP. Most interviewees (3/4) acknowledge that MS has ongoing systems in place for oversight and reporting such as regular reports to RCMP, participation in benchmarking studies and call centers available to clients.

Aside from MS reports, interviewees cited the example of the Pension Accounting Unit as providing oversight of RCMP Pension Plans SIP. Interviewees had the opinion that the RCMP Pension Finance Oversight Committee (PFOC) provided an additional level of oversight. PFOC was established to advise the Chief Human Resources Officer (CHRO) and the Deputy Commissioner of Corporate Management and Comptrollership, on the administration of the pension plans. Document review supports this notion as the identified role of this Committee is to provide a challenge function in relation to pension plans as well as to provide advice and recommendations to NCS concerning the review, management and control of total administration costs charged to the RCMP pension plans ^{Footnote 16}.

Interviewees also commented that the Pension Advisory Committee (PAC) is one further example of oversight. This notion is supported through document review as PAC is mandated through Section 25.1 of the RCMPSA to advise and assist the Minister of Public Safety on matters arising in connection with the operation of the RCMPSA. PAC is chaired by the CHRO and is supported by the NCS team ^{Footnote 17}.

It should be noted that both of these Committees address all pension plans including the SIP. It is logical to assume that if there were glaring deficiencies with this transfer payment program it would be identified and addressed by one or both of these Committees.

From a VAC perspective, they forward monthly reports to the RCMP which informs the RCMP of its activities with respect to the SIP. Additionally, the RCMP has a representative physically located with VAC who maintains daily contact on all RCMP related issues and concerns including the SIP. These reports as well as the RCMP Liaison position support that oversight and reporting mechanisms are in place between the RCMP and VAC. This further demonstrates that VAC is meeting its obligations of ensuring that RCMP recipients are receiving decisions within the established service standards.

2.3 Performance - Efficiency and Economy

Generally, interviewees indicated that the management and administration of the SIP is timely, efficient and costs are reasonable. Although not feasible due to legislation, interviewees suggested that there may be some changes that could be made with respect to the administration and management of the SIP. Suggestions included: having the RCMP take over the responsibility for the determination of whether a death is duty related or having VAC assume complete responsibility for all aspects of the administration and management of the SIP. When providing these alternatives, the interviewees acknowledged that they were not certain if these suggested alternatives would reduce costs.

Some interviewees (3/4) believe that the timeliness and efficiency of the SIP are influenced by factors outside of the RCMP's control. As an example, timeliness and efficiency are linked directly to how quickly recipients provided the required information to initiate or advance their SIP applications. Additionally, timeliness and efficiency are somewhat dependent on VAC as they make the determination of whether a death is duty related and then provide this information to the RCMP and MS. Finally, it was suggested that financial authorities may have affected timeliness on occasion as the RCMP have exceeded financial authority for the SIP and subsequently have been required to seek additional authority to make payments. This may have resulted in delays in making payments. It should be noted that this has been addressed by the RCMP via an Aide Memoir which was approved in 2013. As a result there were increases to the RCMP's financial authorities to a level that should mitigate this situation from occurring in the future.

In terms of cost-effectiveness, the administrative costs for the SIP are reasonable. Program documentation indicates that between 2008-09 and 2012-13 the RCMP paid between $9,764 and $11,367 for administrative costs. Over the last five years, this has constituted less than 0.5 % of the transfer payment program's total expenditures.

One interviewee (1/4) explained that the administration and management of the RCMP Pension and Benefits Programs (including the SIP) is shifting from MS to PWGSC which may result in reduced costs in the future.

The RCMP's Performance Measurement Framework identifies a target of $100 for the efficiency indicator "Average cost of managing a benefits claim for families of RCMP members who have suffered a duty related death" ^{Footnote 18}. As evidenced by Graph 2, the RCMP has achieved this target for the SIP since 2008-09.

Graph 2: Average Morneau Shepell Administrative Cost per Payroll Transaction

Description of graph in tabular format follows.

Source: Administrative costs for SIP and PCA document
Provided by Pension Accounting Unit, Corporate Management and Comptrollership on 2013-07-23

3.0 Conclusion

3.1 Relevance

The evaluation found that the mandate of the transfer payment program is relevant and is aligned with the RCMP and government priorities. Additionally, there is a continued need for the SIP. The roles and responsibilities of the RCMP, MS and VAC are clear and well understood.

3.2 Performance

Documentation, available data and information from interviewees confirm that the applications process, delivery and payment benefits to RCMP recipients is conducted according to policy and generally within service standards. The most commonly cited factor for delays in service or payment are attributed to recipients failing to provide required documentation in a timely manner or at all.

The transfer payment program is achieving its goal of maintaining comparable income levels for survivors of RCMP members whose death was duty related.

Given all indications are that the SIP is being managed in an efficient and effective manner, no recommendations are required.

4.0 Management Response and Action Plan

4.1 Management Response

This evaluation report RCMP Survivor Income Plan transfer payment program has been reviewed and accepted by senior officials of the responsible program areas.

Appendix A: Evaluation Framework for the Pensions under the RCMP PCA & SIP

Appendix B: Bibliography

Government of Canada, Department of Justice, RCMP Pension Continuation Act, Ottawa, NCR: 1970.

Government of Canada, Department of Justice, Royal Canadian Mounted Police Superannuation Act, Ottawa, NRC: 1985.

Government of Canada, Office of the Auditor General of Canada, Report of the Auditor General of Canada to the House of Commons - Chapter 9, Pension and Insurance Administration Royal Canadian Mounted Police, Ottawa, NCR: 2006.

Government of Canada, Public Works and Government Services Canada, RCMP Pension Administration Services - Contract no. M9020-020358/001/ZH - Annex A - Statement of Work, Ottawa, NCR: 2002.

Government of Canada, Royal Canadian Mounted Police, Defined Benefit Administration Benchmarking Analysis Fiscal Year 2010 - Royal Canadian Mounted Police, Ottawa, NCR: 2011.

Government of Canada, Royal Canadian Mounted Police, Defined Benefit Administration Benchmarking Analysis Fiscal Year 2011 - Royal Canadian Mounted Police, Ottawa, NCR: 2012.

Government of Canada, Royal Canadian Mounted Police, Defined Benefit Administration Benchmarking Analysis Fiscal Year 2012 - Royal Canadian Mounted Police, Ottawa, NCR: 2013.

Government of Canada, Royal Canadian Mounted Police, RCMP Performance Measurement Framework, Ottawa, NRC: 2013.

Government of Canada, Royal Canadian Mounted Police, RCMP Program Alignment Architecture, Ottawa, NRC: 2013.

Government of Canada, Royal Canadian Mounted Police, RCMP Report on Plans and Priorities 2013-2014, Ottawa, NCR: 2013.

Memorandum of Understanding Between The RCMP and VAC Concerning Administration of Programs for RCMP Clients Entitled to Awards and Heath Care Benefits In Relation To Service Related Disability And Death, Sept 5 2002.