The Military Compensation Commission Interim Report 

7/16/2014 12:00 AM 


In addition to my recent testimony before Congress about the need to end sequestration now and about military personnel issues, both AUSA vice president Guy Swan and I have met with the congressionally-created Military Compensation and Retirement Modernization Commission.  The commission was mandated by the fiscal year 2013 National Defense Authorization Act to conduct an independent, comprehensive review of military compensation and benefit programs in order to make modernization recommendations to Congress and the administration.

General Swan and I expressed to the commission our belief that the current system has been successful; that contrary to reports, personnel costs have stayed steady at about 30% of the DoD budget for the last 30 years; that using compensation increases since 2001 as a rationale for reducing pay increases is a red herring because those increases were fixes for a pre-existing pay gap that is now closed; that health care costs are not eating the system alive because the Department of Defense has underspent on TRICARE by nearly $3 billion over the last three years; and that the current retirement system is not unfair because non-retirees do not expect the leave service with “401-k like” funds although all servicemembers can contribute to the Thrift Savings Plan, and the current system is designed to be robust to draw volunteers and keep the best of them for a full career.   Finally we strongly suggested that the fiscal pressure that created the commission could be quickly eased by ending sequestration now.

The commission’s report is due early in 2015, however, recently the chairman has issued an interim report that is instructive.  If nothing else, it is a valuable reference document as it details virtually every benefit and compensation program available to military members and their families.  The report describes almost 100 compensation benefits, more than 40 health benefit programs and more than 200 programs and benefits administered by  eight separate federal agencies in support of military, veteran, retiree, and family member quality of life.  You can read the report here. 

The commission in its interim report agreed with us that military compensation has stayed steady at about 30% of the defense budget and that a broader discussion of federal spending levels is a necessary element to ensure the viability  of the All-Volunteer force.  The report further stated that the commission’s work reinforced its understanding that “our people are the strength of our uniformed services”.

As the commission continues its study of pays and retirement, health benefits and quality of life benefits, AUSA and its Military Coalition partners will continue to provide input to allow the commission to make informed recommendations.