DoD makes last-ditch plea for compensation cuts in 2015

The Pentagon brass made a last stand Tuesday in the months-long battle for military compensation reform, imploring senators to back plans to trim troops’ pay raises and benefits in the fiscal 2015 budget.



They‘ve already lost on the other front of the fight, with members of the House Armed Services Committee last week rejecting the proposed compensation changes in its initial draft of the annual defense authorization bill.

If the Senate follows suit later this month, that will all but doom defense officials’ plans to cut about $2 billion from personnel costs next year and redirect the money into training and modernization programs.

Army Gen. Martin Dempsey, chairman of the Joint Chiefs, and six fellow four-stars — his own deputy, the four service chiefs and the head of the National Guard Bureau — argued that those savings are crucial to preserve military readiness and modernization accounts, a refrain they have repeated to lawmakers ever since the budget proposal was unveiled three months ago. “Implementing this compensation package now will help us remain the world’s best-trained, best-led and best-equipped military,” Dempsey said. “Otherwise, we’ll continue to hemorrhage readiness and cut into modernization funds.”

At issue are plans to cap the military pay raise at 1 percent next year, cut housing allowance rates by 5 percent in coming years, reduce the commissary benefit and reorganize the Tricare system to include new fees for non-active-duty users.

But outside advocates — and a growing number of lawmakers — have argued the compensation plans cut too deeply into troops’ wallets, leaving them with greatly diminished buying power even if their paychecks do not actually shrink.

They’ve argued that DoD should hold off on any changes until at least next February, after the Military Compensation and Retirement Reform Commission issues a final report and recommendations on all pay and benefits programs.

Dempsey said that timetable will delay meaningful reform until the 2017 budget, and cost DoD up to $18 billion in potential savings.

“We have enough information to request these nominal pay and compensation changes now,” he insisted. “We know this budget features difficult choices ... but we have created a balanced package that enables us to fulfill the current defense strategy.”

Senators again reiterated dissatisfaction with self-imposed budget caps and looming sequestration spending cuts that have forced Pentagon belt-tightening, but have not offered any firm plans on a different way forward.

Members of the armed services committee’s personnel panel have indicated they want to wait for the commission report, although Sen. Carl Levin, D-Mich., the committee chairman, appeared more unwilling to simply punt decisions to next year.

“We do not have the option of simply rejecting these compensation proposals,” he said. “We would have to make alternative cuts.”

On Wednesday, the House Armed Services Committee is expected to finalize its draft of the annual authorization bill with a $521 billion total cost, but without the Pentagon’s requested compensation changes.

Pentagon planners will know if their lobbying efforts before the Senate committee were more successful by early June.