Military Compensation: Balancing Fairness and Sustainability

February 7, 2006

To execute the military, strategic and operational plans of the United States, the Department of Defense (DoD) requires high-quality uniformed personnel. To maintain such a force, DoD needs a package of compensation that is reasonable and competitive.

Consistent with section 1008(b) of title 37, United States Code,1 the Bush administration directed Secretary of Defense Donald H. Rumsfeld on 2 August 2005 to conduct the Tenth Quadrennial Review of Military Compensation (QRMC). The QRMC, which is expected to convene in 2006, is a complete review of military pays and allowances requested by the President at least once every four years. Areas of particular interest include retirement benefits, health care, special and incentive pays, quality of life and reserve component compensation. The President then submits the QRMC report to Congress.

In the presidential memorandum to the Secretary of the Defense regarding the Tenth QRMC, the President recognized the interrelationship between compensation and the rest of the military manpower system, observing that to “continue to recruit and retain highly qualified personnel for the uniformed services . . . the departments concerned must offer . . . compensation appropriate to the services rendered to the Nation.”2 While military service offers volunteers an honorable career, it must also provide servicemembers adequate compensation for the challenges of military life.