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The government will pay $1.5 billion to cover the pensions of more than 790,000 VA employees who are on Social Security disability benefits.
According to The Associated Press, the payments will be made through the VA’s payroll tax and payroll tax rebates, with the money going to pension plans for retirees, veterans, veterans spouses and children.
In a statement, Secretary David Shulkin said, “We have been making progress toward meeting the VA and its obligations to our veterans and this agreement is another step in the right direction.”
The payments will cover pensions for veterans who are retired, disabled or on Social, Defense or Survivor status and will cover veterans on disability who have reached age 62.
The payments will also cover veterans who were in VA care before January 1, 2020.
Shulkin also said the VA will increase its payroll tax credit by 5 cents for every $1 it pays into the system.
President Donald Trump, who announced the pension payments in March, said they were necessary to protect VA workers and “to prevent more catastrophic cuts in funding.”
The VA is the only federal agency that pays pensions to retired military members, retired Reserve members and their spouses, as well as veterans who have been in the military for more than 30 years.
Veterans on disability and their families are exempt from paying payroll taxes, so they will not see any benefit from the pension funds.
“We are grateful to the Department of Veterans Affairs for their hard work and commitment to veterans and to their families,” said Shulkins.
“The VA’s efforts to provide timely benefits to all veterans and their dependents are helping us to achieve our shared goal of ensuring veterans receive the care and care they deserve.”
The VA will also provide benefits to employees of other federal agencies, including the Federal Communications Commission, the Department in charge of homeland security, the National Oceanic and Atmospheric Administration, the Bureau of Land Management, the United States Postal Service, the U.S. Postal Inspection Service, and the Department for Veterans Affairs.
The pension payments come after Trump signed an executive order in February that will help the VA pay for health care for veterans.
The order included the creation of a $50 billion trust fund, with all funds paid into by a 3.9 percent payroll tax.
Trump’s executive order did not specify how the trust fund would be used.