The federal government will provide thalidomide survivors with pensions of up to $100,000 a year for the remainder of their lives, a major breakthrough for the nearly 100 Canadians who have been fighting an emotional and hard-fought battle for compensation.

Health Minister Rona Ambrose announced Friday that Ottawa would provide tax-free support that depends on the person's level of disability, a system that hews closely to the demands set out by the Thalidomide Victims Association of Canada.

"This is a big day for Canada," Mercedes Benegbi, head of the victims group, said in an interview. "This is a day filled with a lot of emotion. After so much effort, we finally have something that will let survivors live and age with dignity."

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Ms. Benegbi spoke to Ms. Ambrose for more than 30 minutes on Friday morning to hear the package's details.

The payments will be broken down into three levels – $25,000, $75,000 and $100,000 a year – with more than 70 per cent of the victims falling into the top two levels.

Read The Globe and Mail Special Report: After years of neglect, Canadian thalidomide survivors make a plea for help



While the annual sums are lower than what the association had sought, the group says the government's package is a significant step that would have a real impact.

"We believe that this funding will make a profound difference in the lives of survivors and provide them with meaningful support for the rest of their lives," Ms. Benegbi said in a statement.

The announcement marks a historic moment in the battle for recognition for Canadian victims of thalidomide, a drug approved by the federal government in the early sixties as a "safe" sedative for pregnant women suffering from nausea and insomnia. More than 100 babies were born in Canada with extreme disabilities, including missing limbs, internal organ damage, deafness and blindness. Now in their early 50s, they increasingly face crushing pain and financial hardship.

The news of the pensions left victims with a sense of relief and shock.

"I can't believe it," Sandy Hatch, 52, who was born without arms, said from her home in Hamilton. "It hasn't sunk in. I just feel joy and relief."

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Ms. Hatch, who has had to rely on her aging parents for assistance, said the pension will allow her to hire an assistant for basic tasks, such as grocery shopping. "This means I'm going to be taken care of in a good way. It opens so many doors."

She said the federal government has done the right thing, even though the gesture was long overdue. "At least now we have a future."

Nelson Emond, a thalidomide survivor from La Pocatière, Que., said the money means that he may be able to move out of his semi-basement apartment and into a home that can accommodate his wheelchair. At the moment, he has to put on his prosthetic legs to climb the five steps out of his home.

"Finally, we have security, and for the rest of our days," said Mr. Emond, who has worked all his life but pain has made his daily life increasingly difficult.

"Yes, this is 50 years too late. But better late than never. It's never too late to do the right thing," he added.

For Deb Decaire-Conway, a thalidomide survivor in Windsor, the announcement is bittersweet. Her twin brother, Dave, also a victim of the drug, died last year. His heart simply stopped beating. "It feels terribly sad that he didn't live long enough to see this. The settlement wouldn't have saved his life, but it would have given him comfort."

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Many survivors have worn down their bodies by using their teeth and twisting themselves painfully to make up for their missing limbs.

"I'm ecstatic for those who can finally give their bodies a rest," Ms. Decaire-Conway said. "Finally, we can get on with our lives."

Thalidomide victims began mounting a campaign for compensation from Ottawa in earnest early last year, but they were ignored until an article in The Globe and Mail exposed their suffering.

Ms. Ambrose recognized the victims' plight on Friday. "Survivors and their loved ones have exhibited great courage in overcoming unique, daily challenges they face through no fault of their own," she said.

She promised a program that would not subject the victims to bureaucratic demands and paperwork. "I want to reassure survivors that this new program has been designed so that yearly, tax-free payments will continue for their lifetime without the need to reapply or submit receipts," she said.

Her department's package largely corresponds to the Thalidomide Victims Association of Canada's demands. Victims will be assessed strictly on their degree of disability, and not other factors. According to the government's count, there are 92 Canadians who will benefit from the pensions.

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Ottawa announced a $180-million compensation package for thalidomide survivors on March 6 and issued $125,000 lump-sum cheques for urgent needs. But its refusal to share details of the crucial lifetime support caused growing anxiety among survivors. They had planned to gather for a rally on Parliament Hill on Monday in protest; 25 victims, from as far away as Alberta and New Brunswick, had already made travel plans to be in Ottawa despite their considerable disabilities and chronic pain.

The government's plan also includes an annual $500,000 medical assistance fund for needs such as specialized surgery and home or vehicle adaptations.

Funding levels would be reviewed every five years to "ensure that survivors' needs continue to be met."

Ms. Ambrose said Ottawa is working to find a third-party administrator for the program and payments would begin early next year. She thanked Ms. Benegbi for her "tireless efforts on behalf of TVAC members."

Ms. Benegbi has also been supported by a task force of advisers who have worked pro bono.