Commission Issues Report on Compensation

July 3, 2014

 

On July 3, the Military Compensation and Retirement Modernization Commission (MCRMC) issued a 358-page interim report ahead of the release of its final findings expected in February 2015.

The MCRMC was established by the Congress in 2013 to study all aspects of military compensation and tasked to suggest reforms that will ensure the long-term viability of the all-volunteer force, foster recruitment, sustain retention and modernize military compensation.

The interim report makes no formal recommendations and instead focuses on providing background information on the current military compensation system. The report attributes military personnel cost growth in the past 20 years to inflation (particularly medical inflation), policy changes counteracting recruiting and retention challenges, and personnel funding to support 13 years of war. In addition, the establishment of several new benefits for servicemembers and veterans (i.e., the Post-9/11 GI bill) has contributed to the growth.

More importantly, the MCRMC found that regardless of the reasons behind this growth, military compensation funding has consistently represented roughly 30 percent of the DoD budget; however, the report also stipulated that this does not necessarily provide evidence of fiscal sustainability.

The MCRMC interim report makes it clear that the commissioners believe that a broader discussion of federal spending levels is necessary to ensure the viability of the all-volunteer force. The commission is undertaking a comprehensive review of existing compensation programs to provide a full and nuanced understanding of what it takes to sustain needed force levels during all levels of conflict and economic conditions. This includes pay, retirement, health benefits and quality of life programs.

The interim report does not reveal the leanings of the MCRMC. It’s still unclear if the commission will propose drastic compensation reforms in its final report. MOAA will continue to provide insight and information to help the commission understand the importance of military compensation programs.

Your can read more about the commission and provide your own feedback to the commissioners.