Posted on: Monday, March 21, 2005

MILITARY UPDATE

By Tom Philpott

The Defense Department has asked Congress to resurrect separation incentives and forced-retirement authorities to be used as "force-shaping tools."

The measures, which date from the post-Cold War drawdown era, include:

• A lump-sum buyout bonus, perhaps set at $25,000, to entice enlisted members in overpopulated job specialties to leave the service short of retirement eligibility at 20 years.

• A voluntary separation annuity to be offered as an alternative to a cash buyout, again to entice careerists in over-filled specialties to leave the service before they qualify for retirement.

• New, high-year tenure gates for officers. Like those used to regulate advancement flow for enlisted forces, new gates for retirement-eligible officers would be used to thin out certain low-demand career fields.

• Involuntary Selective Early Retirement Board (SERB) authority. This last-resort tool would be used to retire officers involuntarily.

Though acknowledging SERBs are unpopular, Charles S. Abell, principal deputy undersecretary of defense for personnel and readiness, said that "to make carrots more appealing, you have to have a stick."

The Navy and Air Force, the only two services now executing force cuts, likely would be the first to use the new measures. 

Abell commented during a break in testimony on Wednesday before the House subcommittee on military personnel, where the main topic was the difficult recruiting environment faced by U.S. ground forces and most reserve components as a result of the war in Iraq and an improving U.S. job market.

"It may seem counterintuitive that we would ask for these authorities at the same time we're struggling to recruit and retain," Abell told the panel. "But these are for force-shaping. It is not about getting rid of folks. It's about keeping the right folks."

During the post-Cold War drawdown, which began in earnest in 1992 after the Persian Gulf War, the services enticed many careerists to leave with offers of either an annuity, the Voluntary Separation Incentive (VSI), or a lump-sum bonus, the Special Separation Benefit (SSB).  VSI was set at 2.5 percent of a member's final basic pay multiplied by years served.  SSB was 15 percent of a member's annual basic pay times years served. Abell said the first two new measures would be very similar. 

The Army, which needed to separate 245,000 soldiers starting in 1992, offered the incentives not only to overfilled job specialties but to marginal performers. It also tightened "up-or-out" rules so that, for example, soldiers who failed to attain E-5 pay grade by eight years of service, rather than 13 years, were forced out.

Another involuntary separation tool is the Selective Early Retirement Board, used to review performance of officers, identify the least-capable, and retire them.

Uniformed leaders view SERBs as breaking faith with career officers, Abell said.  But they are distasteful enough to spur more voluntary retirements by officers who don't want to risk their names going to a board.