Only 35% got advice on how to invest lump sum payment

Toronto Sun – OTTAWA – The overwhelming majority of Canadian soldiers who received tens of thousands of dollars in disability payments did not obtain any financial advice, an internal government survey shows.

“I was surprised to learn that less than half of the veterans who received a lump sum payment sought independent financial advice,” said Veterans Affairs Minister Jean-Pierre Blackburn.

Of the 9,138 disabled veterans who received lump sums, worth up to a maximum of $276,080 for injuries suffered, more than 1,000 answered a questionnaire about the award’s effectiveness.

Only 35% of those surveyed reported seeking independent financial advice despite being counseled to do so by Veterans Affairs. The department provides $500 for financial counseling to those receiving awards worth more than $12,500.

Veterans Affairs’ own figures show that percentage is much lower – only one percent of all vets sought any financial advice according to data from March 2010 tabled in Parliament.

Lump sums payments are highly controversial.

Donald Leonardo, founder of VeteransofCanada.ca, said he does not believe the surveys findings because “pretty much every veterans group” is against the lump sum.

“Since we’ve had these lump sums payments, now we have homeless veterans, we have veteran food banks crawling across Canada,” he said.

Francine Matteau, the mother of an Afghanistan vet whose legs were blown off following a roadside bomb explosion in 2007, called the lump sums “a monumental error” that left injured vets without any safety net and urged the government to return to a system of monthly pensions.

While Blackburn admits being “very surprised” by the survey’s results, which he demanded after being inundated with complaints about the lump sums, he told QMI Agency the findings validate the feds new approach.

“Almost 70% of them (said) they prefer receiving a lump sum,” he said, adding for him that’s the majority and the issue is now closed.

The survey found 3% of respondents blew their cash on gambling, alcohol and illicit drugs, while 85% reported using their money well.

Veterans Affairs notes younger and middle age respondents were more likely to say they preferred a monthly pension. Younger respondents and those with mental health conditions were also more likely to spend on drugs and booze.

The survey results are considered accurate within 3%, 19 times out of 20.

althia.raj@sunmedia.ca