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Opening Statement of Hon. Joe Donnelly, Ranking Democratic Member, Subcommittee on Oversight and Investigations

This hearing provides us with an opportunity to learn of the many changes the VA has taken to improve this program since the Subcommittee on Disability and Memorial Assistance held a hearing last Congress on the VA Fiduciary Program.  The VA assures us that it is taking solid steps to fix the problems and weaknesses in the Fiduciary Program; other witnesses will suggest that many problems remain.  I want to be assured that the VA is improving the program and has a solid roadmap to follow as we move forward.

The VA Fiduciary Program, in place since 1926, is one of the most sensitive programs run by the VA, and one most in need of effective management and oversight.  Not only must the needs of beneficiaries come first, but their assets must be protected from fraud and waste.
 
The VA currently oversees approximately 95,000 fiduciaries managing the financial affairs of more than 121,000 beneficiaries.  In Fiscal Year 2011, the VA reports that the Veterans Benefits Administration made payments for compensation and pension benefits of approximately $53.5 billion, while fiduciaries managed approximately $171 million in VA benefits.   

Since the 2010 hearing,  VBA, acknowledging that Central Office oversight of its Fiduciary program lacked priority, announced in November,  2011, that they would consolidate Fiduciary operations from 56 Regional Office into six hubs in six Regional Offices.  The VA informs us that the process will convert to a “paperless processing environment.” These changes should hopefully increase the program’s efficiency and accountability.   

The VA also informs us that it is making progress in coming to grips with the many problems it faces with its Fiduciary Beneficiary System, one of the major flaws exposed during the 2010 hearing.  I am interested to see where we are in this process, and hope to get a detailed timeline as to when the VA expects to bring forward a new electronic case management system.

I hope the VA, and our witnesses, can provide insight into the current staffing levels of the VA fiduciary Program, and whether we might need additional personnel.   I also would like to explore the effectiveness of current training efforts and ways that this could be improved.

I am interested to hear that VA believes that it has fully addressed the recommendations made by the VA OIG and GAO. I hope we will have an in-depth discussion of where we have been and where we need to go.  

The Fiduciary Program faces many challenges, and many problems in improving oversight.  We must ensure that while we provide beneficiaries and their families with a meaningful say in the fiduciary process, we must make sure that the needs and interests of veterans come first.

I am pleased that the VA has taken steps to improve the Fiduciary Program, but I know this Subcommittee wants to make sure that these steps represent real progress in fixing these real problems.