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The Honolulu Advertiser
Posted on: Monday, May 15, 2006

Benefit, pay plans to be negotiated

By Tom Philpott

Active-duty service members and Reserve forces will get an across-the-board pay raise of 2.2 percent to 2.7 percent in January. The amount still needs to be resolved.

The pay raise is just one of several key personnel issues that the House and Senate armed services committees handled differently while reshaping the Bush administration's defense budget request.

The Senate committee supports a 2.2 percent raise, the figure proposed by the administration to match wage growth in the private sector. The House panel wants 2.7 percent.

The Senate panel also voted to end a dollar-for-dollar "offset'' in the Survivor Benefit Plan payments that surviving spouses experience when they also qualify for tax-free Dependency and Indemnity Compensation from the Department of Veterans Affairs. And the Senate bill would accelerate the effective date of the Survivor Benefit Plan's so-called paid-up rule to October this year, rather than in 2008. Under the rule, premiums no longer will be collected from retiree participants aged 70 and older who have paid for least 30 years.

The House bill is silent on the two Survivor Benefit Plan changes.

The House committee bill does allow any drilling reserve component member, starting in 2008, to enroll in Tricare Reserve Select, a premium-based health coverage plan. The Senate committee seeks no change to reservists' health benefits, giving the Defense Department more time to implement lesser improvements the Congress passed late last year.

Some of the pay-and-benefit disparities will be ironed out through floor amendments this month, but most likely will be reconciled this summer in conference committee.

The separate authorization bills HR 5122 and S 2507 do agree already in some critical areas, making their enactment this year almost certain. Both, for example, endorse the administration's call for a special pay raise next April for warrant officers and for longer-serving enlisted members in grades E-5 through E-7.

The targeted raises would be on top of the January hikes. April increases will be as small as 1.1 percent for E-5s with at least eight years of service. The largest would be 8.3 percent for a warrant officer (W-1) with 20 years or more served.

Both committees also endorse stretching the military pay chart to give longevity raises every two years from 28 years through 40 years, affecting pay for certain higher ranks. Flag officers would see an extra 4 percent to 7 percent from the proposed pay table expansion. Basic pay for a warrant officer (W-5) with 30 years would climb by 13.8 percent. A W-5 with 38 years would see a combined raise by next April of 25.4 percent.

Healthcare provisions dominate the personnel section of both bills. Each bill has language to block temporarily the steep increases in Tricare fees and co-payments planned by the administration for 3 million under-65 military retirees and dependents. The House bill wants a special task force to study the fees, supported by work already done by the Government Accountability Office and Congressional Budget Office. The Senate bill also calls for a study of Tricare fees.