Friday, October 16, 2009

Fix early retirement for the Guard and Reserve as a force management tool

by David Small, ROA director of Air Force Affairs

For the past number of years, the topic of early retirement has been on the lips of Reservists, Reserve Officers Association legislative advocates, and key supporters in Congress. Today's Reserve duty is a far cry from what was imagined when a non-regular retirement was first envisioned. With the reserve participating as a key component in the operational force at tempos that prevent them from maturing their civilian jobs, an equitable retirement plan must be in place to ensure use of the Reserve Components is sustainable.

The Reserve Officers Association does not advocate for individual benefits unless there is a valid national security basis to do so and the retirement age reduction is one of ROA's top legislative priorities.

"The way we rely on our National Guard and Reserve has fundamentally changed since September 11, 2001 ... We need our military personnel and their families to know that we stand behind them and honor the great sacrifices they make on behalf of our nation." Sen. Saxby Chambliss said in July.

The Reserve retirement bills of the 107th Congress were the first steps in rebalancing that equation for the twenty-first century. They were the start of the debate and in 2005 the Senate finally included a variation of early retirement in its version of the National Defense Authorization Act, only to have it stomped out during conference.

The legislation by Sen. Saxby Chambliss (R-GA) proposed an early retirement that could be earned through mobilization on contingency orders. For every 90 days of deployed service, the Guardsman or Reservists reduces his or her retirement from age 60 by 3 months.

Basing earlier retirement on mobilization in support of contingency orders after 9/11 excluded individuals who have supported the GWOT under different types of orders, and others who provided contributing support that permits Active duty personnel to be deployed. While controversial due to it being tied to contingency orders only, it was a stepping stone.

Twelve proposals for early retirement were introduced in 109th Congress. Eight were for early retirement for Reservists at age 55, two were for a tiered reduction of one year for every two years served over 20 years of service, and the last was three months reduction in the retirement age for every 90 days in support of a contingency operations.

In 2007 through written testimony, ROA proposed an early retirement plan that was based on accruement of retirement points. Early retirement should not be based on the type of service, but on the aggregate of duty. It shouldn't matter if a member's contributions were paid or non-paid; on inactive duty or active duty for training, special works or for mobilization.

This approach would provide the Guard or Reserve members with an element of personal control to determine when they retire and will encourage increased frequency of service and service beyond 20 years.

That year, H.R. 3449 was introduced by Rep. Joe Wilson (SC), which would have provided eligibility for earlier Reserve Component retirement based on accumulated duty as measured by the total of accrued retirement points.

Finally, in 2008, the National Defense Authorization Act recognized the necessity and drive of past initiatives and included an early retirement provision for those Guard and Reserve members who are mobilizing after January 28, 2008 – the date the NDAA was passed – but left ineligible 600,000 who have already served since 9/11/2001. While a huge win for Reservists, this plan this is not equitable.

The reason given by Congressional leaders is that it would cost $2.1 billion over ten years (original estimates were $1.8 billion). In a year when money is given to banks and automakers, it is not fair that those who mobilize to defend this country are ignored. Reservists and National Guardsmen are taking the same risks as Active Duty members who are deployed, yet receive different retirement compensation.

While blatantly unfair on the surface, the bigger issue is that there is no incentive for Citizen Warriors to continue their volunteer spirit, or serve past 20 years. Both longevity of service and volunteerism are key components to sustaining Reserve operations during today's operational tempo. Early retirement, when viewed with these considerations, is a strong force management tool.

"These citizen soldiers have grown from a strategic reserve to an operation force that has seen combat overseas. Their service and sacrifice should be counted." Rep. Joe Wilson said in February.

Among the 600,000, over 200,000 Reserve Component members have been mobilized more than once. These young men and women have served and sacrificed, putting their private lives and civilian careers on hold to mobilize in support of our country. This provision would pay back some of the retirement accruement lost from their civilian job. To exclude their contributions is inconsiderate.

Here are the facts: Congress passed Early Retirement based on 90 days reduction for 90 day service. The new program began on January 28, 2008 for mobilization thereafter. All earlier service was excluded including those who had been called up between 9/11/2001 and 1/2008. Over 700,000 Guard and Reserve have mobilized, but the service of 600,000 Reserve Component members is ineligible. These individuals will have to do additional service to reduce their retirement age.

ROA was the first out of the gate to take action, working with Senators Saxby Chambliss (R-GA) and John Kerry (D-Mass.) to introduce a corrective measure. They reintroduced legislation to correct the eligibility date to September 11, 2001. While the bill was not included in the mark-up of the fiscal year 2010 National Defense Bill (S.1390), Sens. Kerry and Chambliss were successful at adding it as an amendment (Sec 660). The Senate passed the NDAA on July 23, 2009. Unfortunately, it was not included in the House version of the National Defense Authorization and was ultimately canned during conference in October.

Click here to read Kerry and Chambliss' letter to colleagues.

"Providing our Guard and Reserve retroactive credit for retirement benefits they've rightfully earned is one small way we can honor their tremendous sacrifices." Sen. John Kerry said in July.

As ROA pointed out in its 2009 testimony to the House Armed Services Committee, ROA doesn't view this congressional solution implemented in 2008 as the final retirement plan. The Commission on the National Guard and Reserve recommended that Congress should amend laws to place the active and reserve components into the same retirement system. Secretary of Defense Roberts Gates refers to the Tenth Quadrennial Review of Military Compensation's comprehensive review of the military retirement systems for suggested reform. The later report suggests a retirement pay equal to 2.5 percent of basic pay multiplied by the number of years of service.

Under a continuum of service, this approach would provide both the Active or Reserve Component members with an element of personal control to determine when they retire and will encourage increased frequency of service and service beyond 20 years within the Reserve.

The changes passed in the non-regular retirement by the first session of the 110th Congress were the first changes to legislation that was enacted since 1949 when Public Laws 80-460 and 80-810 defined training, pay categories and retirement for the Reserve component. Fifty-nine years later the Reserve Components are still operating under these early laws with few significant changes, even though Reserve participation has increased dramatically, and DoD policy has changed the Reserves from a strategic to an operational force.

Even corrected, the new benefit is not the final solution for earlier retirement for the Reserve Component. Several reasons support further earlier retirement adjustments for the Reserve Components by:

  • Correcting existing early retirement provisions to include all Guard and Reserve members who have served since 9/11/2001.
  • Passing further reduced retirement options, coupled with the removal of the artificial barriers of mandatory retirement and separation dates, will increase force management options.
  • Thoroughly evaluating ROPMA (Reserve Officer Personnel Management Act) to identify other ways to increase flexibility in force management.
  • Recognizing that a “Gray Area Retired Reserve” zone (individuals who reach their mandatory removal date and do not receive a retirement annuity) does not present a good business case. Technological changes and medical advances have allowed most services to move beyond an age-centric management principle.
  • Combining the Pentagon’s continuum of service policy that allows active and reserve component members easier transition between active duty and reserve status with a compensation and retirement package transformation.

The Reserve forces are no longer just a part-time strategic force but are an integral contributor to our nation's operational ability to defend our soil, assist other countries in maintaining global peace, and fight the global war on terror. The ROA believes that if the Pentagon is asking more of its Guard and Reserve, it has to give more back in return. Improvements with an earlier retirement option needed to be considered.

Guard and Reserve members feel that with the change in the roles and missions of the Reserve Component, the contract has also changed. Informal surveys keep indicating that earlier retirement is the top issue asked for by Guardsmen and Reservists. They ask why, if they are facing the same risks as Active duty, is there a 20 year difference in access to retirement pay.

ROA fears that retention problems will soon be on the increase. Reservists fully understand their duty and are proud to serve. However, many in the Guard and Reserve are currently weighing factors that affect their decision to stay in the military. While the statistical average retirement for Guard and Reserve is at 24 years, more and more Reserve Component members are choosing to retire once they qualify at 20 years of service.

The high costs of personnel turnover and retraining should also be fully considered when measuring the affordability of benefits and compensation for the Active and Reserve components. Lost experience is one intangible that is difficult to measure in dollars.

Click here for ROA's position paper on this topic and bring it to your Representatives in Congress. A grass roots initiative on this issue will help support the campaign.

Click here for the ROA resolution drafted by its 65,000 members on this topic.


Michael O'Halloran said...

Does anyone know the method used to calculate the cost of the early retirement. I hope they backed the cost out when the reservists reach age 60?

Bill Tubbs said...

I agree... Congress is most notable for fudging the numbers on anything they do in order to either support or oppose something. The fact that the media is never able to get the type of information that Michael O'Halloran is asking about is very damning to that body. An earlier ROA factsheet shows the cost to be about $210M per year. Just a simple calculation based on simple assumptions makes this an interesting argument without even knowing the information that Congress used. Assume monthly reserve retirement pay at $1,000 per month, and 3 months early retirement. That's a "one-time" cost of $3,000 for an individual(because at 60 we're back to normal retirement pay that is already calculated in the budget). At $210M estimated by Congress, we're talking about 70,000 reservists retiring and getting 90 days early pay EACH year. Something in the Congressional calculation smells....

Anonymous said...

Parity with Active Duty Retirement is the one and only true solution. The ROA has not taken a stand strong enough for this life member.

Anonymous said...

Reservists are double cut. It is fair for a member to receive retirement benifits based on participation. However, for this benifit to be delayed in excess of 20 years, by waiting until age 60, is unacceptable. DOD has gambled that by working two jobs we will not live to see our retirement. By some accounts 26% of reservists don't see a dime.

Pat Mosites said...

I served 13 years on active duty and as a Reserve was involuntaryily recalled for contingnency operations for Bosnia in 1996 and again in 1998/99 which became Kosovo War. Why does the cut off remain at 9/11 when many of us served in operations well before this including GULF WAR I. Many of us also contributed to the end of the Cold War which was was as much a national emergency as GWOT. I can understand how the Vietnam Vets felt as forgotten when they returned. I am not diminishing the efforts of anyone serving but the US Military's birth did not begin on 9/11/2001.

ReserveOfficer said...

Often times legislation needs to be done incrementally, especially when cost to the budget is the argument given against passing anything. Just correcting to 9/11 is said to cost $2.1 billion dollars over ten years.

ROA plans to continue to work this issue, with a retirement model that credits all active and inactive service over ones career. Mobilizations such as Desert Storm and Bosnia peace keeping would be included as well as non-paid additional training.

Unfortunately, this must be taken one step at a time.

Anonymous said...

2.1 Billion over 10 years is but a Fart in a Windstorm for the US Congress. The Iraqi and Afghani people and their institutions get MORE than that in a SINGLE Fiscal Year from US Taxpayers. Yet Congress whines about paying OUR citizens what WE HAVE EARNED !

I' tired of the excuses and tired of getting screwed by my own govt !

Randy Jensen said...

I did 8 year active duty and 22 in the reserves. I was in 5 wars/conflicts and have more active duty time in the reserves than when I was a career soldier.

The reserves were not designed to be full time soldiers for years on years yet they were use as career soldiers. We deserve a retirement just like the career soldiers, waiting 20 year is unacceptable.

I know reserves who lost families, careers. I lost my job with a defense contractor Northrop Grumman/TASC. They let me go when I returned home. I am still not working.

The GI Bill is another problem. I retired June 2008. You had to be on active duty as of AUG 2009 to transfer it to you child. I have two Masters degrees and can use it. Why not let me transfer it to my child. I earned it.

I retired with 30 service, cant retire for 2 more years, lost my job and can't transfer my GI Bill. That stinks! While congress has an outstanding retirement package with better health benefits than any citizen has. WHY THE DOUBLE STANDARD!

As a life time ROA member I am very disappointed in the weak stand the ROA and MOAA have taken on this issue.