thedrifter
11-14-06, 01:13 PM
November 06, 2006
Law allows retired-pay boost after 30 years
By Gordon Lubold and Rick Maze
Staff writers
Enlisted service members and officers who stay in beyond 30 years could get a big boost in their retirement pay after a successful push by the Pentagon to give experienced service members incentives to serve longer.
The 2007 Defense Authorization Act, signed into law Oct. 17 by President Bush, contains a provision that allows the Defense Department to give an extra 2.5 percentage points per year in retirement pay to service members who stay after 30 years.
The increase would not be automatic, however; it would be granted on an as-needed basis for people in specific jobs and who meet other eligibility criteria.
While it’s unclear how many senior people leave early because there are few incentives to stay, a senior Pentagon official said the provision is a good idea at a good time.
“It’s all part of a common-sense effort to ensure the value of pay more closely tracks the value of one’s contributions,” said a senior defense official who spoke on condition of anonymity.
“Heretofore, DoD had viewed over-30 service as gratuitous — no hike in pay or value of retirement after 30 — and that undervalued the work and the contribution” of those individuals, the official said.
A change, he said, is “long overdue.”
Under current law, most people retire under a system that gives them a percentage of their average basic pay over their three highest earning years, almost always the final three.
A service member who retires at 20 years gets 50 percent of his “high three” basic-pay average. For each additional year, he accrues another 2.5 percentage points, up to a maximum of 75 percent of average basic pay over the three highest earning years after serving 30 years.
Until now, there were no further multipliers for service beyond 30 years.
The provision in the defense law removes that 30-year cap and allows an additional 2.5 percentage points of average basic pay over the three highest earning years for every year beyond 30, with no cap other than mandatory retirement age, which varies by rank.
The provision effectively means that someone who continues to 40 years of service would retire with 100 percent of his “high three” basic-pay average for life, the senior official said.
That would go over well for someone like Marine Sgt. Maj. Dennis Frye, senior enlisted adviser at U.S. Northern Command, who just crossed the 31-year mark Oct. 2.
“I loudly applaud the initiative,” he said, noting that service members like himself who act as “theater strategic level” enlisted advisers typically serve beyond 30 years. “In my view, this initiative represents a long overdue and very appropriate adjustment to this particular pay provision.’
Longevity raises extended
The 2007 Defense Authorization Act also expands the basic-pay table to 40 years and provides additional longevity raises for the most senior commissioned officer, warrant officer and enlisted paygrades. Until now, the last longevity raises came at 26 years of service, giving no significant incentive to stay more than 30 years except for the perks that come with senior positions in the military.
Both actions are part of an effort to “assist that small number who serve more than 30 years with zero pay hike provided in the pay table, and no increase in retirement percentage,” the Pentagon official said.
The chief focus for the proposal was a need to retain seasoned — and battle-hardened — E-9s who still have something to offer, particularly in the war zones.
“Their seniority has real operational value that should also be recognized by pay value,” the defense official said. But congressional aides stressed the new pay incentives would not flow automatically; they would be granted only under yet-to-be-determined policies set by Defense Secretary Donald Rumsfeld.
In its report estimating costs for the overall bill, the nonpartisan Congressional Budget Office said about 400 people would be affected the first year, at a cost of about $2 million extra in retired pay.
Over the next 10 years, the costs would total $197 million as more retirees fall under the new pay provisions, the CBO said.
Ellie
Law allows retired-pay boost after 30 years
By Gordon Lubold and Rick Maze
Staff writers
Enlisted service members and officers who stay in beyond 30 years could get a big boost in their retirement pay after a successful push by the Pentagon to give experienced service members incentives to serve longer.
The 2007 Defense Authorization Act, signed into law Oct. 17 by President Bush, contains a provision that allows the Defense Department to give an extra 2.5 percentage points per year in retirement pay to service members who stay after 30 years.
The increase would not be automatic, however; it would be granted on an as-needed basis for people in specific jobs and who meet other eligibility criteria.
While it’s unclear how many senior people leave early because there are few incentives to stay, a senior Pentagon official said the provision is a good idea at a good time.
“It’s all part of a common-sense effort to ensure the value of pay more closely tracks the value of one’s contributions,” said a senior defense official who spoke on condition of anonymity.
“Heretofore, DoD had viewed over-30 service as gratuitous — no hike in pay or value of retirement after 30 — and that undervalued the work and the contribution” of those individuals, the official said.
A change, he said, is “long overdue.”
Under current law, most people retire under a system that gives them a percentage of their average basic pay over their three highest earning years, almost always the final three.
A service member who retires at 20 years gets 50 percent of his “high three” basic-pay average. For each additional year, he accrues another 2.5 percentage points, up to a maximum of 75 percent of average basic pay over the three highest earning years after serving 30 years.
Until now, there were no further multipliers for service beyond 30 years.
The provision in the defense law removes that 30-year cap and allows an additional 2.5 percentage points of average basic pay over the three highest earning years for every year beyond 30, with no cap other than mandatory retirement age, which varies by rank.
The provision effectively means that someone who continues to 40 years of service would retire with 100 percent of his “high three” basic-pay average for life, the senior official said.
That would go over well for someone like Marine Sgt. Maj. Dennis Frye, senior enlisted adviser at U.S. Northern Command, who just crossed the 31-year mark Oct. 2.
“I loudly applaud the initiative,” he said, noting that service members like himself who act as “theater strategic level” enlisted advisers typically serve beyond 30 years. “In my view, this initiative represents a long overdue and very appropriate adjustment to this particular pay provision.’
Longevity raises extended
The 2007 Defense Authorization Act also expands the basic-pay table to 40 years and provides additional longevity raises for the most senior commissioned officer, warrant officer and enlisted paygrades. Until now, the last longevity raises came at 26 years of service, giving no significant incentive to stay more than 30 years except for the perks that come with senior positions in the military.
Both actions are part of an effort to “assist that small number who serve more than 30 years with zero pay hike provided in the pay table, and no increase in retirement percentage,” the Pentagon official said.
The chief focus for the proposal was a need to retain seasoned — and battle-hardened — E-9s who still have something to offer, particularly in the war zones.
“Their seniority has real operational value that should also be recognized by pay value,” the defense official said. But congressional aides stressed the new pay incentives would not flow automatically; they would be granted only under yet-to-be-determined policies set by Defense Secretary Donald Rumsfeld.
In its report estimating costs for the overall bill, the nonpartisan Congressional Budget Office said about 400 people would be affected the first year, at a cost of about $2 million extra in retired pay.
Over the next 10 years, the costs would total $197 million as more retirees fall under the new pay provisions, the CBO said.
Ellie