- The Washington Times - Monday, March 30, 2015

President Obama said Monday he supports the recommendations of a military commission that would reduce the size of traditional military retirement pay by about 20 percent and offer a new defined-contribution benefit for troops who leave before 20 years of service.

In a letter to congressional leaders, Mr. Obama said the proposals are “an important step forward in protecting the long-term viability of the all-volunteer force, improving quality-of-life for service members and their families, and ensuring the fiscal sustainability of the military compensation and retirement systems.”

Mr. Obama said he has directed his advisers to refine some recommendations, and that the White House will report to Congress on any proposed changes by April 30.

Under the recommendations, the plan would continue to offer full retirement benefits to anyone who has served 20 years or more.

The Military Compensation and Retirement Modernization Commission issued a report in January report calling for shrinking the size of traditional military retirement pay by about 20 percent and offering a defined-contribution benefit for troops who separate before 20 years of service. Lawmakers of both parties raised sharp questions about the panel’s stated belief that the changes will satisfy service members while also saving money for the Treasury.

The commission’s proposal include decreasing the “multiplier” that the Pentagon uses to calculate traditional retirement pensions from 2.5 to 2.0, lowering the initial value of retirement checks by 20 percent.


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Under the new plan, the Defense Department also would contribute up to 6 percent of basic pay into individual troops’ retirement savings accounts.

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