Notice to all CSAT Members and Guests

It is about time someone writes about this !

Sajjan says veterans’ pensions ‘a top priority,’ MPs’ pensions three times higher than veterans with similar tenures

Joan Peterson, a 17-year veteran who receives about $47,000 a year including disability payments for her military service, says the discrepancy between military and MPs’ pensions 'disgusts' her.

By DEREK ABMA
PUBLISHED : Monday, May 30, 2016 12:00 AM
A Canadian Armed Force captain who plans to retire in 2024 after 25 years of service can count on a lifetime pension of about $40,000 a year, while an MP who recently retired after 22 years of service will get a pension of $129,600 a year, according to the Department of National Defence and the Canadian Taxpayers Federation.

The first figure comes straight from the DND website in a section that lays out different scenarios for how a career in the military sets someone up for retirement.

It provides the example of a theoretical character named Capt. Lisa Aldridge who joined the military in 1999. She’s currently earning $91,000 a year, and after 25 years would be entitled to a full pension. That would amount to $38,266 a year and she would get an additional $7,234 until the age of 65 as a “bridge” before her Canadian Pension Plan (CPP) benefits kick in. Her pension starts seeing annual increases tied to inflation once she turns 60.

The MP getting a pension of $129,600 is the real-life example of former Conservative MP Diane Ablonczy, who served from Oct. 25, 1993 until the last federal election on Oct. 19, 2015. That figure comes from the Canadian Taxpayers Federation, which has estimated the amounts owed to all MPs who retired or were defeated in last year’s election.

Pension payouts for MPs are based on a formula that sees them getting three per cent of their salaries times the number of years they’ve served up, to a maximum of 75 per cent, based on their five best consecutive earning years.

Sean Bruyea, a retired Air Force intelligence officer and vice-president for government watchdog group Canadians for Accountability, said military pensions are generally based on two per cent of soldiers’ earnings times whatever number of years they’ve been in the service—so after 25 years, this amounts to 50 per cent of one’s salary.

MPs have to serve six years to qualify for a pension. They can’t start receiving their full benefits until they are age 65. They can start receiving their pension as early as age 55, if they choose, with a penalty of one per cent of the full benefit for each year earlier than 65 they start getting their payments.

Before 2013, MPs only contributed to seven per cent of their overall pensions. Their self-paid proportions have been gradually increasing since then and, as of Jan. 1, 2017, they are to be paying for 50 per cent of their pension, with the government covering the rest.

MPs leaving office before six years of service are simply returned their contributions.

Members of the Canadian Forces must serve 25 years in order to receive an immediate pension, unless medically discharged, under which conditions members must have served at least 10 years. In other cases where members have served less than that, accumulated pension benefits can be deferred until they reach the age of 60 or be transferred to locked-in retirement savings accounts.

The proportion military members contribute to their own pensions vary. DND provides a scenario on its website of a warrant officer with 23 years of service of which he has contributed to a pension. At this point, the member is required to contribute 6.7 per cent of his overall salary of $69,600 a year, amounting to $4,365 annually. Once the warrant officers gets to 30 years of service, they only have to contribute one per cent of earnings.

According the DND website outlining different scenarios, a theoretical soldier named Cpl. David Jones, after seven years of “pensionable service,” or years in which he has contributed to the pension plan, would have put in $14,885 to his pension. If he leaves the military at this time, he would be due a one-time transfer worth $35,725, if he chooses not to defer, which would have to go into his new employer’s registered retirement plan or his own locked-in retirement savings.

On the other hand, the CTF’s chart shows several MPs that were defeated in the last federal election after serving seven years—including Conservative John Weston, the NDP’s Malcolm Allen, and Independent Scott Andrews—are set to receive lifetime pensions worth almost $35,000 a year.

Former Conservative cabinet minister Leona Aglukkaq, who was defeated in the 2015 election after seven years of service, will get a pension of $49,565 a year, which if she lives to the age of 90, will pay her a total of $2.5-million, based on estimated annual indexing of two per cent a year. She was also due a one-time severance payment of $123,750. She finished third in her bid for re-election last year in the riding of Nunavut, which was won by Liberal Hunter Tootoo.

“It just shows how generous MPs’ pensions are … and not in line of what the average Canadian can expect,” said CTF research director Jeff Bowes, who said military pensions are more along the lines of what a typical Canadian gets.

Mr. Bowes said the move made by the previous Conservative government to get MPs to pay a bigger share of their pensions is “a good start,” but he said more work should be done to make MP pensions “more comparable to what Canadians have come to expect.”

The Parliament of Canada website says pensions for MPs were implemented in 1952 under the leadership of then-prime minister Louis St. Laurent, who was concerned that highly qualified individuals were not running for federal office because they were concerned about their ability to be financially secure in their later years.

Joan Peterson served 17 years in the Canadian Forces starting in 1979. As a master corporal, she was medically discharged in 1996 as a result of having multiple sclerosis. She saw service in Croatia in 1993 in an area that saw heavy shelling, though she was not a direct combatant.

“Even now, after all these years, I will sometimes hear what I think is incoming artillery—it really does whistle—and then shake my head and say, ‘No. Can’t be, not here,’ ” she said in an email to The Hill Times.

Ms. Peterson, who lives in Bawlf, Alta., about 120 kilometres southeast of Edmonton, said last year she received combined benefits, including all pension and disability payments, of $47,186.

Former Conservative cabinet minister James Moore, who did not run in the last election, is set to receive an annual pension of $89,589 after just less than 15 years as an MP. He was also due a severance payment of $123,750, according to the CTF.

Ms. Peterson said the vast differences between MPs’ and military pensions “disgusts me. I am appalled that my 17 years of full-time military service to this country is a mere $12,432.12 [before disability payments]. My husband had 20 years service and his pension is a measly $15,000 per year.”

Jordan Owens, spokesman for Defence Minister Harjit Sajjan (Vancouver, South, B.C.), said in an email that “the administration, policy development, and maintenance of [Canadian Armed Forces] pension plans is a top priority for the Department of National Defence.”

A review of veterans’ pensions is in order, said NDP MP Irene Mathyssen (London-Fanshawe, Ont.), vice-chair of the House Veterans Affairs Committee.

“I would like to see that all veterans are given a fair pension and veterans should have the same pension standards as MPs and public servants,” she said in an email to The Hill Times.

In followup interview, she said that beyond the example of the captain who gets $40,000 a year after 25 years of service, she’s more concerned about others have not attained as high a rank before leaving the military.

“I think it’s time we looked at all of this in a critical way and had fairness very, very much at the centre of how we treat our veterans,” she said.

Ms. Mathyssen said the level of MPs’ pensions is not necessarily too high, however. She said most don’t serve the six years needed to qualify for a pension, and for someone like Ms. Ablonczy, her 22 years of service “are hard years. So, I wouldn’t take anything from her because she was a good Parliamentarian, she worked very hard, and I know it’s an all-consuming job.”

There are other benefits that can come into play for military veterans if they end up leaving the service due to injury. There’s a maximum disability payment of $310,378, though only 271 of the 50,371 veterans eligible for the disability award had ever gotten that amount as of March 2015, according to statistics from Veterans Affairs Canada.

Mr. Bruyea said the maximum amount for these “pain and suffering” payments would be given to someone who ends up being a double amputee or worse, and the award is lessened for all other injuries on a scale relative to severity. The average payout from this program is $46,550.

Veterans Affairs Minister Kent Hehr (Calgary Centre, Alta.) has announced plans to increase the maximum lump sum payment to $360,000 in 2017.

MPs can elect to be insured for accidental death and dismemberment under the Public Service Management Insurance Plan, which is available to non-unionized public servants. Under the accidental death or dismemberment provisions, participants in this plan get a maximum of $250,000 for themselves or their estate for the loss of life, both hands or both feet, both eyes, a combination of single losses (i.e., one hand and one eye), or loss or hearing, or severe paralysis due to “violent or accidental means.” The amount paid is reduced with less severe injuries, such as quarter of the full amount for the loss of a thumb and index finger on the same hand.

House of Commons spokeswoman Heather Bradley said she could not disclose the number of MPs who have ever received benefits from these provisions, as it is confidential information.

The lump-sump payment system for veterans is the result of the New Veterans Charter that came into effect in 2006. That replaced what was previously a life-long pension enhancement as a result of injury.

Meanwhile, the federal government recently elected to continue fighting a class-action lawsuit against Afghanistan veterans who had complained that their level of benefits constituted discrimination when compared to what veterans of previous wars received. A temporary halt in the legal action was agreed to between the veterans and the former Conservative government last May. Without an out-of-court settlement reached since then, the Liberals elected to continue fighting the court challenge.

Mr. Hehr said in an emailed statement that he can’t “discuss the specifics of an ongoing court case.”

However, he said: “I’d like to point out that this government did not take veterans to court. This is part of an ongoing lawsuit which began many years before we came into office. It is regrettable that, under the former government, veterans had to take this step to ensure their well-being. I wish this could have been resolved before now.”

Mr. Hehr added: “I was given a mandate to re-establish lifelong pensions as an option for injured veterans and I can assure Canadians that I remain committed to this. … We have already taken a very big step forward with Budget 2016, which delivered $5.6-billion in additional support to veterans.”

—With files from Jean-Loup Doudard

dabma@hilltimes.com

The Hill Times

Annual pensions—MPs vs. veterans

Former MP James Moore after 15 years, $89,589 annually

Retired master corporal Joan Peterson after 17 years, $47,186 annually (including disability payments)



Former MP Diane Ablonczy after 22 years, $129,600 annually

Retired military captain after 25 years, $38,266 annually



Former MP Leona Aglukkaq after seven years, $49,565 annually

Retired corporate after seven years, $35,725 lump transfer



Sources: Canadian Taxpayers Association, Department of National Defence, Joan Peterson

Derek Abma is deputy editor of The Hill Times. can be reached at dabma@hilltimes.com. Follow on Twitter at @derekabma.

http://www.hilltimes.com/2016/05/30/sajjan-says-veterans-pensions-a-top-priority-mps-getting-pensions-several-times-bigger-than-veterans-with-similar-tenures/65522

I think that those that have been low balled in regards to ELB/SISIP, because their wages were so low when they released, should also be calling as well. ELB should be based on the basic rank you achieved while serving. So if you were a Sgt in 1990, your minimum ELB should be 90% of a basic Sgt in 2016, not just increased by the max 2% per year from the 1990 rate. Why should higher ranks be making less than what a current Private, just because the CF pay rates grew exponentially compared to the 2% cap imposed on the ELB and SISIP.

The Hill Times is doing a story on comparing MP pensions with veterans' pensions including CF retirement pensions, disability awards and disability pensions. They would like to speak to veterans about their experiences with pensions/awards in any of the three plans listed above. I would think that those veterans who are struggling with the following would help point out the big gap between what MP's receive and what veterans receive:

1) Those veterans released before the big CF pay raises that ended around the year 2000 and therefore have a CFSA monthly payout at a low level because it was based upon the low salaries of the past.

2) Those reservists who received little or nothing before the CF pension changes occurred in 2012

3) Injured veterans who received a low ball Disability Pension or Disability Award.

Those interested please contact ;  Derek Abma at the Hill Times:   dabma@hilltimes.com
 Phone:  613-688-8834
               
Thanks

Trooper