What Will Possible Budget Cuts Mean for Your Pay?

What Will Possible Budget Cuts Mean for Your Pay?
Photo by Cpl. Kameron Herndon/Marine Corps

By MOAA Staff


First, the good news: Servicemembers can expect a 2021 pay raise close to last year’s 3.1% increase despite overwhelming financial uncertainty, a top House lawmaker recently told reporters.


But while Rep. Mac Thornberry (R-Texas), ranking member on the House Armed Services Committee and a former committee chair, said he expects the 3.0% raise included in the White House’s February budget proposal to stay put, there are no guarantees – this year, or especially in the coming years.


The last four military pay raises have matched the Employment Cost Index (ECI) benchmark used, by statue, to set a fair figure. Learn more about that process, and why MOAA tracks it so closely, here, but remember: The ECI figures are guidelines, not requirements.


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Defense Secretary Mark Esper already has expressed concerns that coronavirus-related belt-tightening “may lead to smaller defense budgets in the future,” according to a May 4 U.S. Naval Institute News report. This could put pressure on White House budget-makers or Congress to disconnect military pay from ECI in an attempt to make up some of the lost funds.


Protecting military pay remains a key MOAA priority, especially as past Congressional Budget Office reports on ways to cut the federal deficit – which will increase after coronavirus expenditures – have included suggestions to cap the military raise below the ECI.


Compensation can’t be sacrificed for other budget needs – doing so undermines retention, leading to a less-experienced, less-capable force. It also further hampers recruitment efforts, which have suffered during the COVID-19 pandemic.


MOAA will continue to work with legislators to ensure both pay and benefits for servicemembers remain strong in coming years. Our numbers make our message stronger; consider joining or upgrading today to add your voice.


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