Veterans brace for battle and disappointment as pension decision looms

The Liberal government is expected to announce a complicated overhaul of the system of veterans benefits system in an effort to deliver on its promise of giving wounded ex-soldiers "an option" of lifetime pensions.

Ex-soldier says Liberal plan for veterans pension must be tax-free and end unfair clawbacks

The Liberal government's forthcoming shakeup of the military pension system will be a complicated two-part rejigging of the current system. (CBC)

The Liberal government's plan to give wounded ex-soldiers "the option" of a lifetime pension will be a complicated two-part rejigging of the current system, CBC News has learned.

A series of sources with knowledge of the file say the first component involves recognizing the pain and suffering of injuries with either the existing lump sum award, or a monthly tax-free payment to a maximum of $1,200 per month.

The second component is a "bundling of existing benefits" already available under the often-maligned New Veterans Charter.

The plan, to be released on Tuesday — a week after the House of Commons recess — has been two years in the making.

The veterans community was awash with rumours Thursday after some advocates had background conversations with senior veterans affairs officials.

Changes to the system are not expected to come into effect until 2019, said the sources who requested anonymity because of the sensitivity of the file.

A spokesman for Veterans Affairs Minister Seamus O'Regan said the government is committed to delivering on its promise, but would not talk about any details.

"We remain committed to a lifelong benefit option for ill and injured veterans," said Alex Wellstead. "Options and numbers are not nailed down."

The plan will likely not reduce the political heat from veterans groups who have, since the 2015 election, been expecting a major overhaul and a return to what they perceive is a more generous regime.

No parity with previous regime

At the heart of their dissatisfaction was the switch in 2006 away from lifetime pensions for wounds sustained in the line of duty towards a system of lump sum payments with a maximum expenditure of $376,000.

That will not change, the sources said, and the Liberal plan for monthly payments represents the maximum "amortized over time" at the discretion of injured veteran, up to the age of 80.

A policy group that advised former veterans minister Kent Hehr warned him last spring not to go down the road of amortizing the existing benefit.

The average pain and suffering award is $43,000, according to Veterans Affairs Canada documents obtained by CBC News under access to information legislation.

That means very few wounded soldiers would ever see the entire $1,200 per month payment which will be touted next week.

Under the old pension act severely wounded soldiers would have received up $2,700 per month, but Liberal government sources have long said that their changes "would not seek parity" with the previous system.

Call to end clawbacks

It is that disparity that was at the heart of the class action lawsuit by veterans of the Afghan war — a case that was recently thrown out by the B.C. Court of Appeal.

The ex-soldiers claimed they were being discriminated against because the changes were introduced halfway through the war — creating a situation where troops injured in the same conflict at different times would get different benefits.

The Liberals, in the last election, promised to change that by giving soldiers the option of a lump sum or a lifetime pension.

One of the people involved the court case said the changes the government is about to make need to meet a simple test in order to satisfy aggrieved ex-soldiers.   

"The bar the government has to meet is parity with the pension act in terms of the net dollars in a veteran's pocket every month," said retired major Mark Campbell, who had both legs blown off in Afghanistan in a booby-trapped ditch.

"It can only be a real pension if the benefits are tax free and if there is no clawback of their military pension as part of the disability payment."

'Bundling of existing benefits'

The government has repeatedly argued that the new system is just as generous when one takes into account taxable entitlements such as the earnings loss benefit and the permanent impairment allowance.

But Campbell said what doesn't get mentioned is the pension clawback, which is "huge" for veterans.

Veterans have complained that that portion of the system is mind-boggling in its complexity and next week's changes are expected to address that by the "bundling of existing benefits."

The Trudeau government signalled in last spring's budget that it would have something to say before the end of the year on the issue of veterans pensions.

It has already put an estimated $6.3 billion put into improved veterans services, including the reopening of nine regional offices shuttered by the previous government; and the rehiring of both claims processing staff and case managers at Veterans Affairs.

Wounded vets brace for Liberals' pension announcement

5 years ago
Duration 5:31
'Right away, it just set up alarm bells across the veteran community,' says veteran advocate and Canadian Forces veteran Aaron Bedard.


Murray Brewster

Senior reporter, defence and security

Murray Brewster is senior defence writer for CBC News, based in Ottawa. He has covered the Canadian military and foreign policy from Parliament Hill for over a decade. Among other assignments, he spent a total of 15 months on the ground covering the Afghan war for The Canadian Press. Prior to that, he covered defence issues and politics for CP in Nova Scotia for 11 years and was bureau chief for Standard Broadcast News in Ottawa.


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