Military retirement changes cause worry

WASHINGTON -- A House defense subcommittee is preparing a hearing to review proposed changes to the military retirement system that are worrying the troops.

Among lawmakers calling for an examination is Rep. Joe Heck, R-Nev., an Army Reserve colonel with more than 20 years in the military.

An aide said Heck is unsure whether the changes would affect him and will disclose any potential conflicts when the hearing takes place next month.

A Pentagon advisory board has recommended phasing out the lifetime pensions for service members who retire after 20 years and replace them with a 401(k) savings plan that would pay benefits at ages 60 to 65.

"I am concerned with the proposed changes," said Heck, a member of the House Armed Services Committee.

Heck said he questioned how the plan would affect those serving if it is adopted, saying he has seen conflicting information whether a transition would start immediately or whether current service members would be grandfathered in under the old rules.

"Our military personnel deserve to know, with certainty, that they will receive the benefits they were promised," Heck said in a letter to Rep. Joe Wilson, R-S.C., chairman of the House military personnel subcommittee.

"Failing to live up to our commitments will only serve to undermine our military and will severely diminish its ability to recruit and retain highly qualified individuals," he said.

Wilson said a hearing is set for Oct. 25.

Heck has been in the military for more than 20 years, "so I assume he would receive full retirement benefits when he decides to retire," spokesman Darren Littell said.

Littell said Heck will be prepared to disclose whether or how the proposed changes might affect him and members of his reserve unit.

"We have been pretty active in disclosing any potential conflicts on military issues," Littell said.

Defense Secretary Leon Panetta has said he would consider the recommendations of the Defense Business Board, composed of executives of companies that do business with the Pentagon.

It concluded after study this summer the military retirement system is growing too costly and is unfair to many service members.

While those serving at least 20 years earn generous benefits, service members who leave sooner receive no retirement pay.

"Eighty-three percent of those who serve will receive no retirement benefit," the board said in briefing materials prepared in July.

Also, "costs are rising at an alarming rate," the board concluded. The financial liability will rise from $1.3 trillion, of which only $385 billion is funded, to $2.7 trillion by the time current recruits retire.

"Action must be taken to contain these spiraling costs, or they will undermine future warfighting capabilities," the board said.

A 401(k)-style system would allow younger members of the military to build benefits toward retirement, even if they depart in fewer than 20 years, the board concluded.

Contact Stephens Washington Bureau Chief Steve Tetreault at stetreault@stephensmedia.com or 202-783-1760.