Advocates for lowering the age-60 threshold for when military reserve retirement benefits begin will find little to cheer about in a new report from the Government Accountability Office.
With numerous bills before Congress to drop the reserve retirement age to 55 or even younger, lawmakers in 2002 directed GAO to review reserve retirement, assess the need for change and weigh the costs of granting annuities earlier against the benefits of retaining more reservists.
The GAO report, released this month, concludes that the Department of Defense doesn’t collect attrition data in a way that can determine whether the services are keeping enough reserve and National Guard members for 20 years or more. The department also lacks data to show whether offering earlier annuities would improve personnel retention rates.
Yet, the report goes on to give five reasons for Congress to move cautiously, or perhaps not at all, to change reserve retirement. They are:
* Cost. The retirement fund expense to lower the age at which reserve annuities start would range from a low of more than $5 billion over 10 years to a high of more than $34 billion. The totals include the cost of providing, at 55 or earlier, both annuities and health benefits.
* Too few would gain. Because only one in four reservists serves long enough to retire, a change in law to start annuities earlier won’t benefit most reservists who served or are now deployed in Iraq and Afghanistan.
* Better alternatives. The services have more efficient ways to raise the compensation of deployed reservists. They include hazardous duty pay, family separation allowances and a new, still unused special allowance for military personnel who endure frequent or long deployments.
* Rebalancing skills. The Defense Department is shifting skills previously concentrated in the reserves and National Guard to active-duty forces. This should relieve operational stress on high-demand reserve occupations and soften the argument for changing reserve retirement.
* Unintended effects. Changing reserve retirement could have negative consequences for keeping active-duty forces. For example, GAO said, if reserve retirement is changed to provide immediate annuities after 20 years of service, some personnel who planned to remain on active duty until retirement might leave and serve their remaining time in a reserve unit.
Rep. Jim Saxton, R-N.J., introduced HR 742, the most popular reserve retirement bill now on Capitol Hill. It would lower the age threshold to 55. So far, it has 190 co-sponsors, a balance of Republicans and Democrats.
The GAO report, Saxton said, hasn’t shaken his support for the bill. In fact, he is encouraged that GAO’s 10-year cost estimate for his bill is $13.6 billion, lower than the $16 billion estimate from the Congressional Budget Office or $19 billion from the White House’s Office of Management and Budget. OMB opposes the bill, he said.
The notion that most deployed reservists won’t benefit may or may not, be true, Saxton said. But what’s clear, he said, “is that we have come to rely on reserve and National Guard personnel more than ever. Therefore, we need to try to make policy that will encourage people to join and stay.”
Lowering the reserve retirement age “might encourage reservists not only to join but to stay longer, given an earlier light at the end of the tunnel.”
In a small nod to advocates for change, GAO noted that the age-60 threshold was set in 1948, when federal civilian employees had to work until 60 to qualify for retirement. In 1967, the minimum federal civilian retirement age was lowered to 55 for employees with 30 or more years of federal service.
To comment, write Military Update, P.O. Box 231111, Centreville, VA, 20120-1111, e-mail milupdate@aol.com or go to www.militaryupdate.com.
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