Wednesday, August 3, 2011


From the AUSA Alert - MILITARY RETIREMENT PAY NOT A LOGICAL TARGET. A proposal that would radically alter the military's retirement system was unveiled last week at a Defense Business Board meeting. The board provides advice to the Secretary of Defense based on best practices from the private sector.

Among the recommendations proposed by the Board's retirement task force is the establishment of a mandatory TSP program for all military servicemembers. Here are some of the proposed changes:

§ The government contribution to the TSP program, including extra incentives, would be funded at a percentage level comparable to the highest end of a private sector pension plan

§ The plan would vest after 3 to 5 years, payable at age 60 to 65 (or Social Security age)

§ Partial withdrawals (or loans) to cover education, healthcare, or other specified emergencies would be allowed

§ The plan would be risk adjusted to recognize combat roles, family separation, and other unusual duty

§ Would double contributions for years in combat zones or high risk positions

§ Would provide greater contributions for hardship tours

§ Would apply to reserve as well as active duty personnel

§ The plan would grandfather existing retirees and "fully disabled" veterans under the current system

Based on the number of calls and emails AUSA has received from its members, this proposal has clearly struck a nerve. Many of our members consider this and other retirement overhaul proposals that have recently been announced to be a "slap in the face."

Shortly after the Board's announcement, AUSA President Gen. Gordon R. Sullivan, USA , Ret., released this statement:
"Guaranteed retirement benefits are essential to recruitment and retention in both the Active and Reserve Components. Retirement benefits are a covenant with our Soldiers."

"Any erosion of retirement benefits, implied or actually promised, affects Soldier morale and can leave retirees with the impression that they have been betrayed. Soldiers earn, and deserve, a high quality retirement program for their selfless, dedicated service to our nation. In today's environment of persistent global conflict, it is imperative that existing retirement benefits are sustained and enhanced for both the Active and Reserve Components (RC) of the Army. Both Active and RC Soldiers and units are being called upon repeatedly for myriad combat and support missions for extended periods, and it is essential that retirement programs further support the sacrifices they make."

"The retirement system must ensure that all of those who serve are properly compensated, retained, and encouraged to complete their careers. We must ensure the benefits available to all retired Soldiers and their Families are commensurate with the increased demands and sacrifices they endure on active duty."

"Our nation demands much from its military, and the retirement benefits in place are not gifts - they have been earned through blood, sweat, toil, repeated deployments, missed births, birthdays and anniversaries and sometimes loss of limbs or life."

"Shifting the burden of our nation's fiscal mess on to the backs of our military -less than one percent of our population who volunteer for decades of service in harm's way defending our way of life - is morally bankrupt."

"The richest nation on earth can afford to continue the current retirement system for those who defend it with a lifetime of service. As has been said time and again - defending freedom is not free."

It is important to remember that this is just a proposal. The Defense Department has not endorsed it nor sent it to Congress as a proposed change to the current plan. Another thing to remember is that over the years there have been many proposals to change the retirement plan. While there is considerably more pressure to cut costs than ever before, it is difficult to imagine Congress changing the retirement system so radically while the military is so heavily engaged.

That said, AUSA is well aware that it is Congress that we must continue to influence. Please add your voice to ours. Go to, click on "Legislative Agenda" and then "Contact Congress". Put your zip code in the box entitled "Elected Officials and then click on the prepared letter "Preserve Military Retiree's Benefits".

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