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Sean Kilpatrick/The Canadian Press

The decision not to reappoint the Veterans Ombudsman to a second term has put the spotlight on the New Veterans Charter, federal legislation that determines the programs and services available to veterans injured in the service of their country. Our financial analysis shows that the charter does not adequately meet the needs of veterans who are severely disabled.

The New Veterans Charter, which came into effect in 2006, was established by Veterans Affairs Canada to meet the needs of "new" veterans, especially those who have served in Afghanistan. The assumption is that these veterans have different needs from those who served in the Second World War and Korea or with United Nations peacekeeping missions. The charter provides an earnings loss benefit, a financial award and other allowances to veterans who have been assessed as having a service-related disability. It replaces the Pension Act, which provided these benefits to "traditional" veterans under a different legal structure. The single biggest difference is that the charter offers a one-time lump-sum disability award, whereas the Pension Act offered a monthly tax-free pension for life and a survivor benefit.

Our analysis compared financial programs offered under the charter with those offered under the Pension Act. We also determined the effects of factors such as degree of disability, rank and family status on the total financial benefits available under both plans.

We created and examined the case of a 40-year-old male army captain who is injured and discharged from the Canadian Forces. We assumed he has a disability assessment of 80 per cent, a classification given by Veterans Affairs based on severity of disability, either psychological or physical. This classifies him as "severely disabled" and depends not only on the diagnosis but also on how it affects his life. The financial benefits under both the charter and the Pension Act were totalled and compared. We also assumed that the captain was married with two children.

It was found that, in today's dollars, assuming this veteran lived to be 78 and that he was entitled to all financial benefits, he would have received a total of $1,479,854 under the Pension Act and $967,203 under the New Veterans Charter. This means that, under the charter, this officer would receive only 65 per cent of what he would have been entitled to had he been injured before 2006.

Additional analyses showed that the Pension Act is more sensitive to factors that may increase a veteran's financial need. If our captain's disability was assessed at 100 per cent, for example, the charter would award him only 58 per cent ($1,022,419) of what he would have received under the Pension Act ($1,755,187). The charter doesn't take into account marital status or number of children; so, under the Pension Act, a veteran's pension is higher still if he's married or has children. In addition, the Pension Act provides more money per year lived after 65 than does the charter. Finally, a higher military rank provides more money under the charter even if the severity of the injury to the captain and his higher ranked comrade are the same and might have resulted from the same incident. No such rank/entitlement discrimination exists in the Pension Act.

Our analysis included all programs under the New Veterans Charter. But some of the programs are very restrictive and not frequently awarded. For example, the permanently incapacitated allowance, a monthly amount paid to veterans permanently and severely impaired, has been awarded to only 16 people. This equates to 0.1 per cent of the 20,796 veterans receiving financial allowances under the charter. It's unlikely, therefore, that our captain would qualify for this allowance.

Our study demonstrates that veterans are financially disadvantaged under the New Veterans Charter. In addition, the compensation gap between the charter and the Pension Act widens if a veteran lives longer, has more children, has a higher disability assessment or is released at a lower rank. Changes need to be made to this charter if members of the Canadian Forces, and Canadians generally, are to be assured that severely disabled veterans receive compensation equivalent to that under the Pension Act.

Alice Aiken is an assistant professor in the School of Rehabilitation Therapy at Queen's University. Amy Buitenhuis is a research student with the Canadian Disability Policy Alliance at Queen's.

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