Raising pay, raising debate

Some say 3 percent increase isn’t enough to close gap with private sector
By Gordon Lubold - Staff writer
Posted : February 19, 2007

A 3 percent pay raise that would take effect Jan. 1 is on the table for all service members, but military advocates and the new Democratic majority in Congress are pushing for something more.

President Bush’s fiscal 2008 budget proposes a 3 percent across-the-board pay increase for service members and a 4.2 percent average increase in housing allowances.

But that proposed pay raise would only match the expected rise in the Employment Cost Index, a Labor Department measure of private-sector wage growth. For the past eight years, military pay raises have been set at half a percentage point above the ECI in an effort to close what some say is a longstanding pay gap between military and private-sector wages that dates back to the early 1980s.

The fiscal 2008 budget also would not include targeted raises, as the 2007 plan did. Those targeted raises will take effect April 1 for many warrant officers and midgrade enlisted members.

A 3 percent raise would give the average E-6 about $1,100 more per year, and an O-3 about $1,650 more per year. Pentagon officials note that basic pay has risen 32 percent since 2001.

But Rep. Ike Skelton, D-Mo., the new chairman of the House Armed Services Committee, has already expressed concern that 3 percent is not enough.

“Because this pay raise will not exceed the ECI, the gap between military and private-sector pay increases during fiscal 2008 will remain 4 percent,” Skelton said in a statement after the White House’s fiscal 2008 budget proposal was released Feb. 5.

“Military recruiting and retention depends upon our ability to compete with the private sector in terms of pay and benefits,” Skelton said, adding that his committee will review the military pay raise proposal to “make sure it is adequate to the needs of our service members and their families.”

Steve Strobridge, government relations director for the Military Officers Association of America, said he believes lawmakers need to do a bit more, especially in light of what service members are being asked to do lately.

“We feel strongly that the Congress needs to ‘plus up’ the pay raise in the budget” to at least 3.5 percent, he said Feb. 7.

But Cindy Williams, a defense analyst at the Massachusetts Institute of Technology in Boston, said she believes the calculations used to determine the “pay gap” between military and civilian pay are “bogus” — and believes troops are doing much better when housing allowances, for example, are taken into account.

“Housing allowances have gone up much faster, so if you included [that], you’d have a much smaller” pay gap, she said.

Williams said the ECI is too broad a measuring stick to use in comparing military pay because it includes all U.S. workers, not just the young, predominantly male workers who make up the majority of the active-duty force.

Bush’s $481 billion budget plan for fiscal 2008 represents an 11 percent increase over this year’s budget, and includes another $141 billion to fund the wars in Iraq and Afghanistan next year.

The budget plan came with a third piece, an “emergency supplemental” request of $93 billion to cover war costs for the rest of the fiscal year that ends Sept. 30.

The fiscal 2008 budget request also seeks nearly $39 billion for the military’s health care system. But that aspect of the budget riles some military advocates because it renews a call to set new and higher fees for military retirees under age 65, in an effort to hold down escalating health care costs.

Last year, the Pentagon put forth the idea to raise enrollment fees by as much as 115 percent over two years for those retirees and their families.

Fees and deductibles would have increased under Tricare Prime, and new enrollment fees would have been created for Tricare Standard.

The proposed changes would not have affected retirees under Tricare for Life or any active-duty members.

The plan was so unpopular in Congress and within the military that it was killed. Pentagon officials are trying again in the fiscal 2008 budget plan but have created a special task force to try to grease the skids.

The Task Force on the Future of Military Healthcare, which includes senior military members and individuals from outside the defense community, will make a final proposal by May on how the Pentagon should fund Tricare, defense officials said.

Strobridge already doesn’t like the plan because instead of phasing in new fees over two years, the fiscal 2008 budget assumes the savings will occur all in one year.

“We’re very disappointed,” he said. “That’s not the way we think we ought to do business on something that important in wartime.”

See pay charts:

2008 Basic pay


2008 Basic pay: extended table


2008 Drill pay


2008 Drill pay: extended table