Defense Department Targets Military Pay Increases for 2004
By Sgt. 1st Class Doug Sample, USA
American Force Press Service
WASHINGTON, Dec. 8, 2003 - Military personnel will see their basic pay more in line with that of civilian counterparts in the private sector in 2004 thanks to an increased pay and benefits compensation package included in the 2004 Defense Authorization Act approved by Congress this year.
Air Force Col. Virginia S. Penrod, director of military compensation office for the Defense Department, said the 2004 military pay and benefits plan provides for a 3.7% across the board pay increase and further targets pay increases for noncommissioned officers and warrant officers, some as high as 6.25 percent for senior-enlisted service members.
In addition, service members will see 2004 increases in housing allowance pay and special incentive pay.
Penrod said the average basic pay raise, which is equal to a little over 4 percent, helps to close the gap between military pay and civilian pay.
"Everyone receives a 3.7 percent pay raise across the board, this is by law," she said, adding that the pay raise is a half percentage point more than the private sector wage earner will earn. "The NCOs, E-5 through E-9 will receive targeted pay raises from 4.6 to 6.25 percent. And we're also paying a targeted raise to our warrant officer grades."
Penrod also noted that part of the pay incentive is to help in retention of senior non commissioned officers, pointing out that highest pay raises, 6.25 percent, will go to E-9s with 26 years or more service.
"This (raise) recognizes the contribution of our senior non commissioned officers and our career enlisted force," Penrod explained. "All NCOs will receive some form of a targeted raise, and the pay increases as the grade increases. So it's an incentive to continue in the military and to pursue higher rank."
Also included in the package is an average increase of almost 8 percent for military basic allowance for housing (BAH)--money given to military personnel to help defray the cost of housing expenses.
Penrod said the almost 8 percent increase for housing allowance continues our effort to reduce out of pocket expenses for military personnel, which the Pentagon is hopeful to do by fiscal year 2005.
"When BAH was enacted, housing allowances amounted to 80 percent of housing costs, this left the service member with 20 percent out-of-pocket cost," she said. "In fiscal year 2000, the Secretary of Defense committed the department to reduce these out of pocket expenses to zero by 2005. And we're on track to do this."
She said that military out of pocket expenses for housing is down to about 3.5 percent for January 2004 and "should be at zero in 2005."
"If you talk to a service member today compared to their compensation package ten years ago they are very pleased," Penrod said. "The housing increase has been absolutely the right benefit at the right time. It shows we do value their commitment to the military and what they do for the country."
Another area of increase pay will be special and incentive pay, such as imminent danger pay and family separation pay.
Penrod explained those pay increase were made possible in part due to President Bush's supplemental funding request this year. That request authorized funding for increases in imminent danger pay from $150 to$225 per month, as well as increases in the family separation pay and support allowance from $100 to $250 per month.
Other new measures in the 2004 compensation package allow for services to offer incentive pay to get officers to extend overseas tours. "Previously this was only offered to enlisted members," she explained.
Penrod said the compensation policy has two principal thrusts: The first of which is to have an overall level of military compensation that is at least equal to the 70th percentile of the pay of civilians with comparable levels of education. The other is to target special and incentive pays and bonuses to address retention problems that are specific to various occupations and recruitment problems.
In addition, beginning in 2004, the new compensation package will begin phasing in percentage increases each year of amount offset under current law for military retirees with a VA disability of 50% or more and eligible to receive both military retirement and Veterans Affairs disability pay. Currently a veteran's retirement pay is reduced by a percentage of the disability pay received from VA.
Penrod said that beginning next year, veterans will receive an increased portion of the "off-set" to their retirement pay. "And by 2014, the member will have the full concurrent receipt," she said.
Another pay benefit for veterans in 2004 will be in combat related special compensation programs for retirees whose disability is directly related to combat or through training for combat. She said now all retirees will be eligible for these payments which essentially provide the equivalent of full concurrent receipt. The retire must have had 20 years of service to qualify.
Penrod said the Defense Department is targeting pay raises for its noncommissioned officers to "recognize the contributions" that noncommissioned officers and career- enlisted force bring to the military.
In summing up the new compensation package, she said that DoD is sending the message that it remains committed to the preservation of a compensation and benefit structure that will provide members with a suitable and secure standard of living and that will sustain a trained, experienced, and ready force in the future.
http://www.defenselink.mil/news/Dec2003/n12082003_200312083.html
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