Royal Canadian Legion
The findings in the recent Parliamentary Budget Officer Report, The cost differential between three regimes of Veterans Benefits, causes The Royal Canadian Legion great concern. The report indicates Veterans, specifically those most seriously ill and injured, will receive less financial compensation than is provided under the current Veterans Well-being Act.
The Legion has long said the most seriously ill and injured Veterans, those who are unable to work and whose quality of life has been drastically impacted; need the ability to lead a financially secure life, and to reintegrate into civilian life. It is those seriously ill and injured Veterans who are suffering the greatest under the current Veterans Well-being Act (previously New Veterans Charter), and whom, according to the report will find themselves again greatly disadvantaged financially if entering the system after April 1 under Pension for Life.
This contradicts the Canadian government promise that no Veteran would be worse off under Pension for Life. Our understanding was that Pension for Life would offer better and substantially more simplified suite of benefits and would not result in a reduction in financial compensation for anyone. While the Legion understands the report focuses solely on financial compensation and does not factor in the other suite of benefits to help both the Veteran and their family, we are discouraged the government has broken its promise, and alarmed that once again Veterans will receive less financial compensation.
About The Royal Canadian Legion
Founded in 1925, the Legion is Canada’s largest Veteran support and community service organization. We are a non-profit organization with a national reach across Canada as well as branches in the U.S., Europe and Mexico. With more than 260,000 members, many of whom volunteer an extraordinary amount of time to their branches, our strength is in our numbers.
The cost differential between three regimes of Veterans Benefits
Several parliamentarians requested that the Parliamentary Budget Officer (PBO) prepare an estimate of the fiscal cost of each of these regimes over the medium term.
Using data from Veterans Affairs Canada, PBO estimated the overall fiscal costs to the government on a net present value (NPV) basis for the existing cohort of beneficiaries and for projected new beneficiaries during the period 2019-2023.
PBO found that the Pension Act regime is the most generous for the veterans and the most expensive for the federal government. The Pension for Liferegime is slightly more generous than the Veterans Well-being Act regime.
Most, but not all, veterans will be financially better off under the new Pension for Life regime compared to the existing Veterans Well-being Act.
While all current recipients of disability benefits will receive an equal or greater amount with the new regime, PBO estimates that about 5 per cent of future recipients would have been better off under the Veterans Well-being Act. Moreover, 3 per cent of new entrants would be greatly disadvantaged under Pension for Life as they would, on average, have received around $300 thousand more in financial support from the existing regime.
This is in part related to the elimination of the Career Impact Allowance Supplement (CIAS), which is offered to veterans with severe and permanent impairment and diminished earning capacities.