Canadian military personnel left scrambling after cuts to out-of-country allowances

Canadian miliatry personnel say they are seeing reductions of between $1,000 to $1,500 a month in allowances. Photo by jerom400 /Getty Images/iStockphoto

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Some Canadian military personnel are now dealing with pay cuts as their allowances for out-of-country service were reduced because of a new government directive.

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The personnel say they are seeing reductions of between $1,000 to $1,500 a month in allowances linked to their out-of-country military service.

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Soldiers sent the Ottawa Citizen a copy of a March 25 notice they received which gave them only a week of notice of the impending cuts.

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The changes came into effect on April 1.

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The reductions in the Post Living Allowance or PLA are based on federal government revisions to what is called the Post Index or PI.

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The PLA is is a non-taxable benefit designed to assist military members serving outside Canada where costs are deemed to be higher. The PI is the measurement used to determine the PLA.

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“Members are strongly encouraged to plan their finances accordingly, particularly in locations where the PI has decreased or where PLA entitlement may cease,” Canadian Forces personnel were informed in the March 25 memo.

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The short notice for the cuts left some military families scrambling, according to Canadian Forces personnel who contacted the Ottawa Citizen.

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The Department of National Defence and the Canadian Forces would not comment on the changes, and instead referred questions to the Treasury Board, which did not provide comment.

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In response to a request for comment on the cuts being faced by military personnel, Defence Minister David McGuinty’s director of communications, Alice Hansen, sent an email noting “our government delivered the most significant update to military compensation and benefits in decades.”

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“As Canada Rebuilds, Rearms and Reinvests in the Canadian Armed Forces, we will do so with our people are the forefront,” she added.

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Many of the PLA reductions are for locations in the U.S. Other military personnel in postings such as Latvia or other locations in Europe are also facing cuts. In other cases, the PLA will actually increase.

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Statistics Canada, in coordination with the Treasury Board Secretariat, is responsible for determining PI values, according to the memo provided to the Ottawa Citizen.

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Carney’s announcement last year of pay hikes for the military was designed to attract new recruits and retain those in uniform. The salary increases ranged from 20 per cent for the lower ranks to an eight per cent boost for senior officers.

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With the 20 per cent boost, the starting salary for a private in the regular force will increase from $3,614 a month or $43,368 annually to $4,337 a month or $52,044 annually. Reserve military personnel would get a 13 per cent boost.