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Then-veterans affairs minister Julian Fantino, centre, makes his way past journalists after testifying before the Commons veterans affairs committee in Ottawa in May, 2014.Chris Wattie/Reuters

While Julian Fantino was ousted as Veterans Affairs minister for failing to make the grade, his landing has proved spectacularly soft for Canadian politics.

The 72-year-old MP remains in cabinet, albeit as junior defence minister now, and is still enjoying the car, driver and extra pay that comes with this high office.

The decision to demote rather than dump Mr. Fantino demonstrates his enduring political value to Prime Minister Stephen Harper as a star candidate in the Greater Toronto Area, likely the most important electoral battleground in the 2015 election.

The former Ontario police chief is still popular, both in his riding and throughout the ranks of tough-on-crime Tory supporters, a senior government official says. Mr. Harper himself courted Mr. Fantino to join his team more than four years ago – beating out then-Liberal leader Michael Ignatieff who also tried to woo him.

"Voters like him. He's got lots of experience in issues that are important to us and to our voters," the government official said.

But all this couldn't save Mr. Fantino at Veterans Affairs, where the writing was on the wall by late 2014.

Mr. Harper's decision to remove Mr. Fantino as the minister of Veterans Affairs this week was made because of "an accumulation of things," a senior source says.

In the months before he lost his job, Mr. Fantino was confronted with one bad news story after another about Ottawa's handling of veterans matters. He struggled in vain to justify how Ottawa was juggling cutbacks and spending in the treatment and support it offered former soldiers.

He lost control of the narrative. In one case that particularly annoyed the Prime Minister's Office, Mr. Fantino played up the fact Ottawa was providing $200-million for veterans' mental health treatment – focusing strongly on the dollar value – only to have it revealed later the money would be doled out over as many as 50 years.

The government was also unhappy when Mr. Fantino couldn't successfully explain why more than $1-billion was left unspent in Veterans Affairs over a number of years even while former soldiers were complaining about lack of support.

The Prime Minister's Office tried damage control in late November, dispatching one of its own to take control of the minister's office while Mr. Harper pondered what to do next.

Weeks later, the Prime Minister made only a nominal attempt to defend his minister during a year-end TV interview with CBC. Asked whether he had confidence in Mr. Fantino, Mr. Harper avoided a direct response, saying "you know what the answer to that question is" and then tried to wriggle out of it, adding "by definition the Prime Minister has confidence in all of his ministers."

Government sources point to the interview comments as a foreshadowing of what was in store for Mr. Fantino.

The Prime Minister didn't have confidence in him much longer, yanking Mr. Fantino from his post on Monday. He's now associate minister of defence, playing a supporting role to Defence Minister Rob Nicholson.

The Vaughan MP's new job – responsible for files such as foreign intelligence and Arctic sovereignty – was designed to put him somewhere where his law enforcement background is useful, but he's not in a starring role, sources say.

"He's not a great communicator. That's not a secret," the senior official said of Mr. Fantino.

"He's going to be in a portfolio where he can play to his strengths without having to deal with his weakness."

Mr. Fantino says he intends to run again in this year's federal election, though a riding nomination contest has yet to be held.

Long before disastrous run-ins with veterans and veteran supporters that helped sink him, Mr. Fantino displayed a knack for controversial comments.

In 2010, the Vaughan MP compared the Liberal campaign strategy of attacks on him to Hitler's propaganda tactics. "I call it the Hitler theory. You tell a lie often enough, you hope that some people will believe it."

One former staffer to Mr. Fantino, speaking on condition of anonymity, said things got so bad in the final months of the minister's tenure at Veterans Affairs it seemed the MP could not generate any positive news from announcements. "Even if minister Fantino announced good news, I think people would have not listened to it much or given it much credence."

In his new post, Mr. Fantino is likely to be seen but rarely heard, which appears just the way the Conservatives want it right now,