OnWatch is a quarterly newsletter of the Fleet Reserve
October 12, 2017
Where Will the Pay Raise Go?
When I was an active duty Marine as soon as I received word of a pay raise at the start of the New Year I was excited and would immediately start calculating how much more I would be receiving. I imagine that attitudes of junior enlisted haven't changed much over the years. With the news of another pay raise for active duty service members, I am sure calculators are at hand calculating just what they will be spending their additional income on. However, taking into consideration any additional cost of living, one has to wonder, is their disposable income really going up?
It all starts with Congress, with input from the President and the Office of Management and Budget. Federal law dictates that military pay raises will be equal to the Employment Cost Index (ECI) every year. The ECI, published by the U.S. Department of Labor's Bureau of Labor Statistics, measures the growth of civilian employee compensation. Unfortunately, there have been several years where the active duty military got less then ECI because the President is empowered to change, if he chooses, the annual military pay increase by executive order. The House and Senate have passed their versions of the FY2018 National Defense Authorization Acts (NDAA) and a conference committee will resolve the differences between the two bills. It is not yet clear whether the military will be getting a 2.1% pay raise, Senate version, or a 2.4% pay raise, House version. The ECI this year is 2.4%. The White House did announce they hoped for the upcoming annual military active duty pay increase of 2.1 percent. In a letter addressed to House and Senate leaders, President Trump said the moves are designed to "put our nation on a sustainable fiscal course." The Senate fell in line with the White House and proposed a 2.1% raise, the House did not. Make sure you subscribe to FRA Newsbytes to stay up to date.
There are many reasons for someone to want to join the military, from traveling the world, educational benefits, service to our nation, family tradition and so forth. While always grateful for a pay raise, as service members begin to realize that said raise will not have a positive result on their standard of living they may begin to search for career alternatives. A lower than ECI pay raise would be detrimental to the military but it is not the only aspect of financial stability that is being considered. During the previous 114th Congress, there was a proposal to eliminate half of the Basic Allowance for Housing (BAH) for a duel military married couple. This proposal was opposed by FRA and was ultimately defeated. However, that doesn't guarantee Congress will not propose this again.
FRA's mantra is, there is NO LAW on the books to protect the pay and benefits you've earned. Your benefits can be reduced or repealed during any legislative cycle. During the current 115th Congress, the Senate passed a plan to deny with-dependent BAH payments to dual-member couples with children sharing the same household. The annual income loss would be more than $5,600 for married E-7s with children living in San Diego. The Department of Defense has stated BAH is an integral element of military compensation. Service members with dependents should not have to suffer this financial penalty based on whether they marry another service member vs. a civilian. This is one example of how both military members of a household would get a pay raise but would still end up losing money.
This trend also will continue after retirement. With new Tricare fee increases for the newly retirees, after January 1, 2018, it will further cut into the cost of living. Congress has the authority to change military and retiree benefits. This was once again proven when the previous Congress grandfathered TRICARE recipients from proposed higher fees. The current Congress's newly proposed NDAA would remove the grandfather clause and allow substantial TRICARE fee increases by repealing the so-called grandfather clause, which excluded retirees who retired before January 1, 2018 from any fee increases. The bill also increases pharmacy co-pays. This year the military will get a pay raise but once everything is said and done just how much of a raise is it?
There are many ways the decisions of Congress have an impact on active duty pay. In the past Congress has looked into changing the Commissaries with the goal of improving cost and quality, but it has yet to take shape. There is a constant debate between Congress and Department of Defense about addressing the needs of the military through readiness improvements and quality of life standards for military personnel and their families. The reality is, there are only so many resources Congress can provide and there must be a way to pay for everything. Funding the military is no small matter and this year it is estimated that the NDAA will cost approximately $700 billion. This is a substantial increase from last year's NDAA and there is still debate about giving the military a pay raise equal to ECI. FRA will continue to protect the interest of our members and advocate on your behalf to ensure that service members are given everything they deserve and need.
To let your voice be heard on ECI pay issue be sure to visit FRA's Action Center.
*FRA is a Co-sponsor of the Congressional Guard and Reserve Caucus Breakfast. This is an opportunity for members of Congress, National Guard and Military reservist leaders to come together to discuss their priorities and goals for the coming year. The Guard and Reserve Caucus Breakfast was held March 8th in which Congressman Steven Palazzo (Miss.) and Congressman Tim Walz (Minn.) strongly advocated for the approval of H.R. 1384.
OnWatch is a quarterly news update for active duty and Reserve personnel, written by Brian Condon. He served four years on Active Duty in the Marine Corps. Condon began his career with the Fleet Reserve Association (FRA), as Assistant Director of Veterans Programs on October 2015. He is committed to FRA's mission to maintain and improve the quality of life for Navy, Marine Corps and Coast Guard personnel and their families. You can reach Brian directly on any of FRA's advocacy issues at BrianC@fra.org