Statement on Signing Bill To Increase Rates of Compensation for Disabled Veterans.

THE Veterans Disability Compensation Rate Increase bill (S. 3348), which I am signing today, will increase the compensation payments and dependency allowances for service-disabled veterans. These increases--retroactive to July 1, 1970-will vary with the degree of disability, but we estimate that the average recipient will realize an increase in benefits of about 11 percent. This bill will also make it easier for former prisoners of war to obtain compensation for disabilities arising from their imprisonment.

Although this legislation calls for spending that would be well above the budget for fiscal year 1971, I sign it because I recognize the Nation's debt to those who have served in the Armed Forces and its special obligation to those who have been disabled in its service. We must make every effort to fulfill all of our responsibilities to those who have done so much for us.

I also recognize that the rising cost of living places special burdens an those who depend upon a monthly benefit check for a significant part of their income. This is a point that I have made frequently with respect to social security recipients and I believe that it is also true of disabled veterans. Benefits for our two million disabled veterans have tagged behind the rise in the cost of living. This bill will allow them to catch up.

In signing this legislation, I am acceding to an increase of some $218 in the budget for the current fiscal year. This added money must come by offering reductions in other Federal spending programs, if we are to avoid further inflationary pressures.

The President has discretionary authority to make certain administrative reductions in the level of Federal spending. I feel that I must use that authority at this time in order to pay for the increased spending called for in this veterans bill.

I have ordered spending reductions equaling the $218 million from other Federal programs, including the following:

Medicaid, by changing administrative regulations to reduce certain excessive charges far above the national average imposed by some medical institutions;

GSA, by cutting supply purchases and deferring some Federal construction in areas where unemployment is not a major problem;

Federal land acquisition, by imposing restrictions upon expenditures for this purpose in several areas;

Atomic Energy Commission, by reducing certain planned expenditures.

I have carefully considered the need for these adjustments and I am convinced that they are in the public interest. It would be most regrettable if our efforts to help disabled veterans cope with the cost of living had the effect of aggravating that same problem for other Americans by increasing the Federal deficit. We cannot permit that to occur.