Former servicemen and servicewomen under the retirement age but unable to work are to receive a new benefit as part of a new veterans support package worth $12 million a year, Veterans Affairs Minister Nathan Guy said today.
The package, launched this afternoon by Prime Minister John Key in a speech to the Returned Services' Association National Council in Wellington, adopts in full or in part 132 of the 170 recommendations from its review of the War Pensions Act 1954.
"It provides new funding of $60 million over the next five years to implement these changes," Mr Guy said.
Key parts of the package include the new Veterans' Weekly Income Compensation, for veterans below the retirement age but unable to work, which will be paid at 80 per cent of the average wage.
Those who accessed that benefit for more than 10 years until retirment would then receive a lump sum of $25,000 "in recognition of their circumstances resulting from service", Mr Key told the RSA today.
The package also creates two separate schemes for coverage under the revamped War Pensions Act.
All current veterans would be covered by Scheme One, which maintains current services and provision. Scheme Two would apply from 2015 for future veterans or those who hadn't claimed yet.
"Operating two schemes will allow us to provide for modern rehabilitation practices for future veterans without impaction on current veterans," Mr Key said.
"It will also enable us to deal with some discrepancies in entitlements."
Meanwhile, the War Disablement Pension and Surviving Spouse Pension rates were to be raised by 5 per cent from next April on top of the forecast CPI adjustment of 1.8 per cent.
Legislation giving effect to the changes was currently being drafted and was expected to be introduced to Parliament early next year.