• Follow us

Canada

How Veterans Affairs quietly buried a $165M accounting error | CBC News

It was an incredibly simple (and incredibly daft) mistake — and it led to a $165 million federal fiscal faux-pas.

In 2001, the Liberal government of Prime Minister Jean Chrétien made what appeared to be an innocuous change to federal tax forms.

It separated federal and provincial tax exemptions, shuffling the basic personal tax credit from one part of the document to another.

Staff at Veterans Affairs, who administer disability awards and pensions, did not pick up on the modification to the tax law for several years and ended up short-changing former soldiers — most of them elderly — who received disability pensions and awards benefits.

It was a mistake that cascaded, over time, into a whopping, multi-million dollar fiscal mess that Justin Trudeau's Liberal government began to mop up last fall.

CBC News has obtained hundreds of pages of documents under access to information legislation, and has conducted a series of background interviews with current and former federal officials, to understand the extraordinary blunder that shortchanged up to 272,000 disabled veterans of roughly $165 million.

The documents show how officials traced the confusion back to the change in the forms and in the Income Tax Act.

More troubling is the fact that the error was discovered and quietly fixed by Veterans Affairs in 2010 — but no effort was made to notify or reimburse those affected by it.

For critics, the records obtained by CBC News raise important questions about fiscal accountability at Veterans Affairs. What actions did bureaucrats take when the error was first discovered? Why it was kept hidden until the former veterans ombudsman blew the whistle internally in 2017?

A significant number of the affected veterans — 170,000 — have since passed away. While the Liberal government has pledged to repay their estates, the documents reveal that Veterans Affairs does not keep track of next-of-kin and has no means of finding them.

No one was held accountable for covering up the mistake and the Liberal government has shown no interest in conducting a follow-up investigation to get to the bottom of the matter.

Jean-Pierre Blackburn shakes hands with veteran Bruce Bullock, 87, in Ottawa on Saturday, May 8, 2010. Blackburn was Veterans Affairs minister when the department corrected an accounting error that cost veterans roughly $165 million - without attempting to compensate those affected. (Pawel Dwulit/The Canadian Press)

A spokesman for Veterans Affairs Minister Seamus O'Regan ducked questions about who made the decision to cover up the error, and why.

"While I cannot speak about the decision-making processes of the previous government, it would be hard to believe a decision regarding the financial benefits of Canada's Veterans would have been made without the Minister's awareness," said Alex Wellstead, a spokesman O'Regan.

"What I do know is that when this was brought to our government's attention, we fixed it."

The minister at the time was Conservative Jean-Pierre Blackburn.

He was unavailable when contacted CBC News.

A 'fundamental breakdown'

Another former Conservative veterans minister, Erin O'Toole, said he believes there should be an investigation and described the decision to bury the mistake as an ethical lapse.

"This appears to be a fundamental breakdown of proper practices in a major department of the government," he said.

"I believe we would support the government on some sort of investigation into this to see if there's a cultural issue here. If someone elevated it to the political level on our watch and we didn't fix it, that is a mistake."

The briefings, slide deck presentations, letters, evaluations and actuarial projections offer a sketch of how the embarrassment unfolded and proceeded unchecked at the department level for the better part of eight years.

Starting in 2002, Veterans Affairs did not take into account the impact of the basic provincial tax credit on veterans.

The flawed method used to calculate disability pensions and awards "was never really questioned until about 2011," says an undated federal government analysis.

The department insisted recently in a statement to CBC News that it "consistently applied the formulas correctly" and blamed the tax changes themselves for the error.

According to the documents obtained by CBC News, Veterans officials at the time appeared to be operating on the assumption that they had the law on their side because the legislation was "silent" on the precise method of conducting the calculations.

The "Pension Act does not specify the calculation for the annual adjustment," said a December 2018 slide deck presentation.

Downplaying the error

The law may not be precise, but the documents show — under the heading of "new information" — that the regulations supporting the legislation do spell out the proper method for calculating the adjustment.

Internally, it seems, officials were trying to gloss over the mistake by downplaying its significance and making it appear — in one of the more recent briefings — as a proactive, positive measure:

"In 2011, [Veterans Affairs Canada] implemented a prospective change to the calculation of Disability Pensions and Disability Awards which was to the benefit of the veteran."

A number of troubling questions need to be put to current and former Veterans Affairs officials now, said O'Toole.

"Did the age — and in some cases, the relatively small amounts — lead someone to make the wrong decision from an ethical standpoint? That is what we should investigate," he said.

"That is perhaps one of the most troubling connections we might draw from this. I sincerely hope that was not the determination made by someone."

In the documents, Veterans Affairs defended its financial practices and said it "employs a rigorous process whereby all escalation calculations are completed by the Statistics Directorate and validated by the Attestation Unit. [The] review and sign off is completed by various directors up to and including the director general of finance."

It's not clear whether anyone in those positions was held accountable when the error was discovered.

A history of program gaffes

Retired lieutenant-general Walter Semianiw, a former senior official at Veterans Affairs, said he's not surprised that the blunder happened in the first place. He also questioned the meticulous fiscal image the department has tried to present in the documents.

During his three years there, Semianiw said, department officials were called on the carpet regularly by the federal Treasury Board for being unable to accurately cost programs.

"Every time we developed a new policy based upon direction from government, gave it to corporate services to figure out the dollars, had it ready in a Treasury Board submission ... to be fair, not all of them, but enough of them came back from Treasury Board, saying, 'Your numbers are wrong,'" he said.

"When I was there, this seemed to be a challenge for the department's corporate services area to be able to determine the correct financial make-up for any type of new program."

Read More



Leave A Comment

More News

Canada – Macleans.ca

Ford government eliminates free tuition for low-income students 2019-01-17 12:34:30The province is cutting fees but says the OSAP grants had become unsustainable and it was time to refocus The post Ford government eliminates free tui

Racial vote pandering sinks Liberal candidate in Burnaby 2019-01-17 07:00:52Politics Insider for January 17: Turmoil in Burnaby-South byelection and America calls out China over arrests and death sentence, as China temporarily

Reel justice prevails: This B.C. man won a 2019-01-16 18:04:24After a long dispute pitting local anglers against wealthy landowners, public interests against private, a recent court decision could set a precedent

Mayday! Mayday! Mayday! Theresa May faces no confidence 2019-01-16 07:00:58Politics Insider for January 16: Svend Robinson seeks end to political purgatory, the war of the travel advisories, and Theresa May's government face

Indigenous leaders are less than thrilled with Trudeau’s 2019-01-15 16:47:12Jane Philpott won respect as Indigenous services minister. Can Seamus O'Regan—a pal of the PM who has yet to distinguish himself in cabinet&mda

A Saudi teenager is welcomed to Canada (and 2019-01-15 16:16:53Image of the week: Rahaf Mohammed al-Qunun stepped off a plane in Toronto and into the arms of Canada's foreign minister. It was a big win for both.

Ottawa warns: travel to China at your own 2019-01-15 07:00:27Politics Insider for January 15: Trudeau's cabinet shuffle leaves some observers puzzled, China sentences a Canadian to death, and the real irony in

The beat cop who lends an ear to 2019-01-14 14:38:42'As police, we are not dealing with good or bad people. We’re just dealing with people, many in a bad situation, with horrendous circumstances

Someone get Jagmeet Singh a newspaper subscription 2019-01-14 07:00:59Politics Insider for January 14: Trudeau shuffles his cabinet, Canadians are suddenly anxious about the state of the economy and Singh needs to brush

No one leans in like Bianca Andreescu, Canada’s 2019-01-11 12:51:49Image of the week: The 18-year-old has followed up huge upset wins in New Zealand by steamrolling opponents in Australian Open qualifiers. Where did t

Tribalism is tearing Canada apart 2019-01-11 07:00:24Politics Insider for January 11: A special Maclean's report on the worsening divisiveness in Canadian politics, and bidding farewell to Scott Brison

The man who marks the edge of Canada 2019-01-10 17:11:19Joe Harrietha has faced off against wildfires, mosquitoes and melting permafrost as he and his team maintain thousands of Canada-U.S. boundary markers

CBC | Canada News

New Bloc leader, same Bloc problems 2019-01-18 04:00:00Yves-François Blanchet is the new leader of the Bloc, but the challenges he faces are not new for the beleaguered sovereignist party.

First Nations lobby Ottawa for a bigger cut 2019-01-18 04:00:00First Nations leaders want to carve out a bigger slice of Canada's multibillion-dollar gambling pie, and they are asking the Liberal government to ch

Liberals push 'economic argument' for green innovation 2019-01-18 04:00:00Liberal cabinet members begin the final day of a three-day retreat today, wrestling with how to advance a green economy — and how to sell it to

Beijing digs in: Canada's complaints are met with 2019-01-18 04:00:00Observers say recent Chinese actions signal a new level of aggressiveness for a rising power quite prepared to throw its weight around when other nati

Twins get some 'mystifying' results when they put 2019-01-18 04:00:00Last spring, Marketplace host Charlsie Agro and her identical twin sister, Carly, bought DNA ancestry kits from five of the most popular companies in

Transport Canada struggling to buy a bus shell 2019-01-18 04:00:00Crash tests that could make transit buses safer and more resilient in a collision have been stalled because Transport Canada has been unable to purcha

Canadian farmers chart gains in Japan as tariffs 2019-01-18 04:00:00With a new Asia-Pacific trade deal slashing tariffs, Canada's pork and beef producers see even more potential in a lucrative Japanese market.

Pot activist Marc Emery denies allegations of sexually 2019-01-17 22:04:25A woman who grew up in Ladner has been speaking out online about what she called Emery's inappropriate treatment of staff and teen admirers at his Ca

Moose Jaw is no longer home to the 2019-01-17 21:00:07People in Saskatchewan are working to restore Mac the Moose to his former glory, after a moose statue constructed 240 kilometers north of Oslo, Norway

'He lives in that other person': Family finds 2019-01-17 18:51:14A family from Piney, Man., who suffered a Christmas Day tragedy say they're taking some comfort in knowing someone else may have a chance to live, ev

Fishing licence, not marriage licence accepted as ID 2019-01-17 18:29:00Debrah Theissen was told her marriage licence was no good as ID but a fishing licence was. Then the airline helped her get one.

'History in the making' as women who made 2019-01-17 17:35:32A mediation circle involving two non-Indigenous women who were charged after posting racist comments on Facebook is being called a precedent-setting a

: Canada

Gov’t announces another supportive housing project for Kelowna 2019-01-18 14:39:45Up to 50 units planned for supportive housing project in Rutland neighbourhood.

Proposed class-action suit seeks $60M in damages for 2019-01-18 14:36:56The bus crash on Jan. 11 claimed the lives of three civil servants and left 23 other people injured, some critically. A proposed class-action suit was

E-cigarette batteries blamed for fire aboard WestJet flight 2019-01-18 14:26:57The TSB says a fire on board a WestJet flight last June was caused by spare e-cigarette lithium-ion batteries that a passenger failed to declare in hi

Accused in slaying of wife at long term 2019-01-18 14:02:35A Montreal man on trial for the killing of his ailing wife told a senior nurse that he had suffocated her.

Longtime Alberta broadcaster Peter Watts dies at 68 2019-01-18 14:01:02Peter Watts, of 'Alberta Morning News,' TSN and CBC Sports fame, has died in Calgary at the age of 68.

‘It was chaos’: Truck crashes into Dartmouth building 2019-01-18 13:58:55"I looked down to see the baby, and as I looked down, the whole side of the building came flying at me."

Family Matters podcast recap — Swearing around kids 2019-01-18 13:52:54Many parents are careful about what they say around their kids but research suggests casual swearing is totally alright.

Ontario government expands online raffles so people could 2019-01-18 13:49:11Since then, 2,000 electronic raffles have been held across Ontario, and now they will be able to be held remotely.

Hamilton acupuncturist charged with 2 counts of sexual 2019-01-18 13:41:45Hamilton police say the alleged incidents occurred at Dr. Chan's office between October 2017 and January 2019, involving female victims aged 24 and 6

Ontario Place as you know it could drastically 2019-01-18 13:23:58The Budweiser Stage, used for concerts, is not subject to redevelopment and the government says it also intends to maintain three hectares of park lan

Freeland to meet with family of Edith Blais, 2019-01-17 19:19:26The 34-year-old Blais and her Italian friend Luca Tacchetto were travelling by car in southwestern Burkina Faso and were supposed to cross the border

Orderly testifies victim in Alzheimer’s slaying required constant 2019-01-17 19:17:40The trial is expected to last between six and seven weeks.

Canada stories

Aboriginal Swarm player deals with racism 2019-01-17 20:16:24Three weeks ago, Lyle Thompson scored the tying goal, then scored the winner with 24 seconds left to lift his Georgia Swarm teammates to an 11-10 win

WARMINGTON: Liberals offer no quarter to ousted B.C. 2019-01-17 20:10:22There are second chances for some inside of Liberal party politics. But not for all. “This lesson that we are learning — and I’ll be

Fournette fighting Jaguars over guaranteed contract team voided 2019-01-17 19:53:09Here’s another good reason – beyond sportsmanship and common sense – for an NFL player to refrain from taking a swing at an opponent

NBA COURTSIDE: Picking the 2018-19 all-star starters 2019-01-17 19:52:48Voting doesn’t close until Monday, but here’s how we think the NBA all-star picks should go this year. The game is on Feb. 17 in Charlotte

CONDUCT UNBECOMING: Cops ring in 2019 by wrecking 2019-01-17 19:35:03Taking the pastry-eating stereotype to a ‘hole’ new level, some Toronto cops are under investigation after allegedly demolishing a cruiser

Saudi embassy helped accused rapist flee Canada 2019-01-17 18:47:59And another one’s gone. A Saudi Arabian man who failed to show for his trial on two counts of sex assault and one of sexual interference in Hali

Ontario businesses cautiously optimistic under new government 2019-01-17 18:35:51Businesses in Ontario have new hope they can succeed with the new provincial government, but there is a long way to go, leaders say. Regulatory red ta

BUFFERY: Ex-Blue Jay Gregg Zaun opens up about 2019-01-17 18:26:35It’s been almost 14 months since Gregg Zaun was fired by Rogers Sportsnet — and one gets the impression he’d still rather not be not

BILLIONAIRE BLUES: Jeff Bezos ‘seriously stupid’ to marry 2019-01-17 18:19:18A former friend of Amazon gazillionaire Jeff Bezos’ new gal pal thinks he’d be “seriously stupid” to marry her. The onetime pa

RANDALL THE HANDLE: NFL Conference Final picks 2019-01-17 17:56:54Rams (14-3) at Saints (14-3) LINE: NEW ORLEANS by 3½ Good coaching matchups this weekend and it begins here. Rams head coach Sean McVay is the

Hundreds of victims, millions of dollars stolen in 2019-01-17 13:59:09Imagine popping your debit or credit card into an ATM the day after taking a cab ride, not being able to withdraw cash and then realizing it’s b

Streaking Bolts won’t let Maple Leafs off hook 2019-01-17 13:45:35TAMPA BAY — There’s not much room for improvement with the Tampa Bay Lightning, but they don’t intend to let up against the Maple Le

Vancouver Sun

Former Mountie at centre of Surrey Six corruption 2019-01-18 14:38:26Former RCMP Sgt. Derek Brassington's pleas to breach of trust in connection with the investigation into B.C.'s biggest gangland slaying brings to an

Can I see Sunday's lunar eclipse in Metro 2019-01-18 14:30:14The celestial event also coincides with a super moon.

Are you ready for a driverless shuttle ride 2019-01-18 14:25:21It promises to be a collision-free ride that may drive you into the future.

NEB rejects Burnaby's bid to stop work at 2019-01-18 14:21:49The National Energy Board has rejected Burnaby’s request that it rescind orders allowing the company building the Trans Mountain pipeline expans

Smoked salmon nuggets distributed in B.C. recalled due 2019-01-18 14:20:19Salmon Village’s maple-flavoured smoked Atlantic salmon nuggets is being recalled due to possible Listeria contamination.

East Vancouver hit-and-run sends pedestrian to hospital with 2019-01-18 14:19:12A 53-year-old woman suffered life-threatening injuries when she was struck by a car in a hit-and-run accident in East Vancouver early Friday morning.

This Week in History: 1946: The Queen of 2019-01-18 14:00:50The burlesque queen was a hit at world's fairs in New York, San Francisco, Chicago and San Diego

Q&A: Wake up your inner dreamer by being 2019-01-18 14:00:49Winnipeg author Keith MacPherson wants to make the pursuit of mindfulness an enjoyable and attainable goal.

Overachiever wants to help others kick their inner 2019-01-18 14:00:43With her new book, The Achiever Fever Cure, author Claire Booth hopes to help others change the way they think and understand that it's OK to chill o

Book review: 'Mesearching' that urgent need for constant 2019-01-18 14:00:31Claire Booth's debut book The Achiever Fever Cure is a lively and candid account of successes and setbacks, missteps and happy accidents.

Garry Handlen convicted in Monica Jack killing: What 2019-01-18 02:04:16Handlen, who will get a mandatory sentence of life in prison, has also been charged with murder of 11-year-old Kathryn-Mary Herbert

Michael Buble reps sparkling water brand bubly in 2019-01-18 00:47:51B.C. football fans hoping for a little local flavour during next month’s Super Bowl telecast will be pleased to know that Burnaby crooner Michae

Montreal Gazette

What the Puck: Canadiens defy odds, but Cup 2019-01-18 14:25:45This is indeed an exciting Montreal Canadiens team but the problem is that by the time the prospects mature, the veterans will be too old.

Macpherson: A remake of Pastagate by the Legault 2019-01-18 14:03:02The CAQ is following the same script that produced a farce over an Italian menu that made Quebec a laughingstock.

Nurse felt sympathy when Michel Cadotte made his 2019-01-18 13:54:32"'I did it. I took the pillow and suffocated her. Call 911. I'm ready. I will wait for (the police). I couldn't take it anymore,'" Linda Desgagn

Lesley Chesterman Leaves the Table: Final food for 2019-01-18 13:53:44In her final column for the Montreal Gazette, our departing restaurant critic reflects on lessons learned during her 20 years on the beat.

Update: Quebec will make carbon monoxide detectors mandatory 2019-01-18 13:16:10The education minister is also requiring air quality checks and inspections of any machinery using combustibles after a gas leak in a LaSalle school.

Sun Youth in urgent need of food donations 2019-01-18 12:41:43Nearly 29,000 food baskets are distributed every year.

Soaking up Sundance: Canadian creators are Utah-bound 2019-01-18 12:15:55Montrealers and Sundance regulars Felix and Paul première two creations, including a nighttime virtual-reality ride through Detroit with Eminem

Bill Zacharkiw's Wines of the Week: Jan. 18, 2019-01-18 12:06:29An elegant carménère at any price, full-flavoured Corbières, a spectacular South African red from a Loire producer, and a young,

Zacharkiw: Most wines age well, but the rules 2019-01-18 12:06:10It depends on what you like in a wine. Don't make long bets on fruity and low-sulphite wines. Champagnes are immediate gratifications. Reds are a gre

The Right Chemistry: The mysterious case of cyanide 2019-01-18 11:30:40Agatha Christie trained as a pharmacist and generally got the chemistry of poisons right. But what about this time?

T.M.R. says an electric shuttle will get citizens 2019-01-17 21:21:54The shuttle, paid for entirely by the developer, will alleviate some of the traffic problems, Town of Mount Royal Mayor Philippe Roy argues.

Montreal police seek help in locating missing teen 2019-01-17 21:12:28Police are asking Montrealers to keep an eye out for a 16-year-old girl who has been missing since Dec. 26. Her family says Deby Aisha François

TORONTO STAR | NEWS | CANADA

Legault lays out Quebec demands for federal leaders 2019-01-17 18:55:35Trudeau’s Liberal government hopes to make gains in Quebec to make up for expected losses elsewhere.

Two more Ontario First Nations join project to 2019-01-17 18:42:53The diesel generating station in Pikangikum First Nation was shut down Dec. 20 as the transmission lines to the provincial grid were energized.

Orderly testifies victim in Alzheimer’s slaying required constant 2019-01-17 18:04:34Maryse Gesse took the stand Thursday at the trial of Michel Cadotte, charged with second-degree murder in the death of his wife of 19 years.

Ten Christian denominations to receive training on sexual 2019-01-17 17:25:33The event, organized by the Mennonite Churches of Eastern Canada, is linked to the #ChurchToo movement.

Allowing students to skip fees will reduce accountability, 2019-01-17 17:13:50The Ontario government announced a number of reforms to higher education that included scrapping free tuition for low-income students and imposing an

Two women investigated for anti-Indigenous comments face mediation 2019-01-17 16:59:32Two Manitoba women arrested over online comments that threatened violence against Indigenous people were asked to read what was written out loud to el

Quebec woman who had relationship with 12-year-old girl 2019-01-17 16:51:36Virginia Genevrier plead guilty to one count of transmitting sexually explicit material to a minor and two counts of breaching a peace bond.

Renovations to be revealed at Saskatchewan school where 2019-01-17 16:46:49The mayor of a northern Saskatchewan community says there are mixed feelings as renovations to the high school are revealed three years after a deadly

Bernier looks to strike some popular chords during 2019-01-17 15:04:46During Maxime Bernier’s speech, he pitched his support for a revived Energy East pipeline, reducing equalization and removing barriers to interp

Niagara College reviewing admission criteria for international students 2019-01-17 15:00:30College giving international students additional language support and reviewing admission criteria for its programs in wake of mass retesting.

Homeowners falling behind growing threat of climate-related catastrophe: 2019-01-17 14:59:30The Insurance Bureau of Canada reports that insurance payouts from extreme weather have more than doubled every five to 10 years since the 1980s.

Gender discrimination persists in Canada’s Indian Act, UN 2019-01-17 14:40:32The committee found the act violates Canada’s international obligations and urged Ottawa to put an end to the differential treatment of an estim

blogTO

30 things to do in Toronto this weekend 2019-01-17 14:08:13Weekend events in Toronto may require some bundling up. Down by the waterfront, Ice Breakers kicks off a season of interactive artwork and Design

The top 10 places to have a girls' 2019-01-17 13:58:27Girls' night out in Toronto is the time when you and the crew can catch up and wind down. Any time spent with friends is a guaranteed

Toronto's downtown relief subway line could be finished 2019-01-17 13:52:43Toronto mayor John Tory announced Thursday morning that the city's long awaited (and desperately needed) downtown relief subway line might 

The top 10 restaurants on Queen St. West 2019-01-17 12:37:50Restaurants on Queen St. West are mostly the realm of fast food chains, generic sushi shops and a pair of warehouse concepts, but there are some genui

Ontario is scrapping tuition discounts for low income 2019-01-17 12:33:35Bad news for students from low-income families: free tuition is no more. Under the previous Liberal government, the province introduced free tuit

10 essential restaurants a Toronto first-timer needs to 2019-01-17 11:51:09Restaurants a Toronto first-timer needs to try are just as essential to native Torontonians as they are to the visitors who get told to check them out

Drake's new $2.2 million hypercar coming to Toronto 2019-01-17 11:46:50Need a good reason to stop by the auto show this year? I'll give you Sixteen—the Devel Sixteen, that is.The world's most mysterious luxury car

The top 50 coffee shops in Toronto 2019-01-17 10:36:54The indie coffee shop scene in Toronto is thriving. In neighbourhoods across the city, baristas are slinging expertly crafted cortados and flat whites

Toronto taxi drivers busted after scamming hundreds of 2019-01-17 10:36:00Toronto Police are warning the public to be careful when using debit cards in taxis after charging a ring of crooked cabbies with more than 250 counts

Toronto Restaurant Openings: Pancho y Emiliano, Flipside Donuts, 2019-01-17 10:03:59Toronto Restaurant Openings highlights the latest food news in Toronto and gives a preview of what's coming soon. Find us here every Thursday morning

Toronto neighbourhood successfully prevents seven-month road closure 2019-01-17 09:19:58In the ever-growing battle that is the Toronto public versus construction, the people have finally chalked up a point. Residents of Forest Hill s

Win $100 Fryday Box and Amazon Gift Certificate 2019-01-17 08:45:26All your favourite snacks are just a click away with Fryday Box. This new Toronto delivery service has everything you're craving including



Disclaimer and Notice:WorldProNews.com is not responsible of these news or any information published on this website.