June 28, 2005

Good morning ladies and gentlemen. The Committee will come to order. First, let me thank all of my colleagues for their understanding of the need for this hearing on such short notice. I know typically we can provide more notice to all of you. But, in this case it seemed very important that we meet as soon as possible to discuss this matter. Second, I want to welcome VA Secretary Jim Nicholson and his staff to the Committee.

Five months ago, this Committee considered VA's budget proposal for FY 2006. Many of us, myself included, relied on the information VA provided and the assumptions the Administration made about the needs for our nation's veterans when we voted on that budget.

Then, only two months later, the Senate debated a Supplemental Appropriation's bill for Fiscal Year 2005. Again, we sought the Administration's advice and many of us relied on that information when we voted on issues concerning the health care needs of our veterans.

Now, I sit here having recently learned that the information provided to me thus far has been disturbingly inaccurate. Needless to say, Mr. Secretary, I am not pleased with that!

So, I asked you to come here this morning and tell this Committee: 1) why VA's assumptions about its budget needs were wrong; 2) when you knew they were wrong; 3) what the consequences are for transferring the money to compensate for the errors; and 4) what is needed to address this problem for Fiscal Year 2006 and beyond.

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In my opinion the question of what to do for FY 2006 and beyond is the most important issue of the day. It may be that we are too far into the FY 06 appropriations process to consider any other alternative besides simply providing the necessary financial resources to address the shortfall. But, if we are going to do that the amount MUST be accurate so we are not back here again in six months talking about FY 06 shortfalls with little notice and even less time for considered debate. This cannot become a regular practice.

Additionally, we must come face to face with the reality that adding funds to the FY 06 budget would mean continuing annual increases in funding for VA health care that average more than 10 percent. At that rate, we will double VA's health care budget every 8 years. This on top of a system that already spends over $82 million everyday or over one half of a billion dollars every week. Ladies and Gentlemen that is an extraordinary amount of money even in Washington. And to suggest otherwise does a disservice to the taxpayers of my home state of Idaho and all of your states too.

I hope we can carry on the discussion about what is in the best interest of our veterans through reasoned conversations and cordial debate rather than press conferences and political innuendo. I think the gravity of this issue deserves more than that. And I think those who wore the uniform deserve nothing less.

With that, I'd like to turn it over to my Ranking Member Senator Akaka.

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