FY10 Pay Raise and Other Changes
Pay and allowancesPay raiseWhat: A 3.4 percent across-the-board raise in basic pay and drill pay is included in the House and Senate bills, half a percentage point greater than the hike proposed by the Obama administration. If enacted, the increase would reduce the perceived gap between military and private-sector pay —calculated by comparing pay raises since 1981 — to just 2.4 percent, the lowest level since 1982, according to the Military Officers Association of America. At its peak in the late 1990s, the gap stood at 13.5 percent. • When: The raise would take effect Jan. 1, and first appear in mid-January checks. • Prediction: A sure thing. Pay assessment• What: A study comparing military and private-sector pay, intended to put to rest disputes about the existence of the pay gap, is ordered by the Senate bill. The House did not pass a similar provision. The study, to be done by the U.S. Comptroller General, would compare military pay and benefits, including fringe benefits and tax advantages, with the pay, bonuses and benefits of civilians of similar age, education, experience and occupation. • When: The study would be completed by April 1, 2010, in time to influence the 2011 defense budget. • Prediction: A sure thing. Basic Allowance for Housing• What: The 2010 budget assumes an average 5 percent increase in housing allowances, although rates, which vary by rank, location and family status, won’t be determined until later this year. Nothing that would interfere with the 2010 increase is included in either version of the defense policy bill, but the House bill contains a provision that might change payments for senior enlisted members starting in 2011. It would require a Pentagon report by July 1, 2010, to review the standards on which housing allowances are based. It would look specifically at whether the type of housing covered by the monthly pay meets the needs and expectations of service members. This provision is a response to complaints that current payments assume that E-9s are the only enlisted paygrade to merit a single-family home. The Defense Department housing standard assumes other enlisted grades are living in apartments, town houses or duplexes. • When: The 2010 increase takes effect Jan. 1, with rates to be announced in December. • Prediction: The 2010 increase is a sure thing, but the budgeted 5 percent average increase might be high considering falling housing prices in many regions of the U.S. As to future hikes in housing allowances for enlisted members, the requested study does not resolve the biggest hurdle: allocating more money. Basic Allowance for Subsistence• What: The 2010 budget assumes a 3.8 percent increase in Basic Allowance for Subsistence, but the actual rate increase — based on Agriculture Department reports on food prices — won’t be determined until later this year. Neither the House bill nor Senate bill contains provisions changing the fixed formula for increases. • When: Effective Jan. 1. • Prediction: A sure thing. Benefits statement• What: Service members would get comprehensive statements at certain points in their careers explaining all of the pay and benefits they have earned, under a provision of the Senate bill. The goal is to ensure people who are getting out of the service, especially for medical reasons, know what benefits they have available. That emphasis would set these statements apart from the annual pay and benefits statements now provided, which are intended to show military people the full value of military compensation — to encourage staying in, not getting out. No similar proposal is in the House version. • When: Effective when the bill is signed into law. The statements would be issued every two years and upon separation or retirement. • Prediction: Details about the statements and when they would be issued might change, but there is a good chance of approval. Prorated special/incentive pays• What: Monthly payment of hostile fire pay, imminent danger pay, hazardous duty pay, assignment pay and special duty pay could be prorated to reflect the actual time that active-duty members performed qualifying service during the month, under a provision of the House bill. The provision also would clarify that Guard or reserve members be paid a skill incentive bonus in the same manner as active-duty members and that the monthly payment of the bonus may be prorated to reflect actual time served in a critical skill. The Senate bill has no similar provision. • When: Effective three months after the bill becomes law. • Prediction: A 50-50 chance. Reserve retired pay• What: About 600,000 National Guard and reserve members mobilized between Sept. 10, 2001, and Jan. 27, 2008, would get credit toward receiving earlier retirement checks, under a Senate provision that would make retroactive a 2008 revision allowing reservists to draw retirement checks 90 days earlier for every 90 days of active duty. The 90-for-90 rule allows checks to be received before age 60, when traditional retired pay begins for Guard and reserve members. The House bill has no similar provision. • When: Effective to payments after the bill becomes law. Only the mobilization credit is retroactive, not any payments. • Prediction: A 50-50 chance.
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