Sweeping Changes Recommended for Reserves

By William H. McMichael

Air Force Times

Friday 01 February 2008

Active and reserve service members would have to wait until age 57 or longer before drawing retired pay under a controversial recommendation from a congressionally chartered commission.

The proposal would spell the end of the current active-duty plan that provides nondisability retirement immediately after completing a minimum of 20 years of service.

The plan comes from the final report of the Commission on the National Guard and Reserve, which went beyond its original charter to review the structure and management of the reserve components by also recommending an overhaul of personnel policies for active members.

Under current retirement rules, an active-duty member is eligible for retired pay immediately after completing a minimum of 20 years of service, which can be as young as 37 for someone who enlisted at age 17. Reservists, however, must wait until age 60 to draw retired pay, although a law signed Jan. 28 by President Bush allows reservists to draw retired pay 90 days earlier than age 60 for every 90 days of mobilization in support of a contingency operation.

Under the commission's plan, a revamped retired system would grant limited retirement benefits beginning after only 10 years of service, although actual retirement pay would not begin until age 62. Those who serve at least 20 years could receive retirement pay at age 60, and those who serve 30 years at age 57.

Under the plan, service members could begin drawing retirement pay at earlier ages, but the annuity would be reduced 5 percent for each year that a member is under the statutory minimum retirement age, which the commission said would be in line with the Federal Employees Retirement System.

For reserve component members, retired pay would continue to be calculated on the number of creditable retirement years, based on earning at least 50 retirement points per creditable year.

The commission concluded that combining the training, promotion and management of active and reserve troops into one integrated manpower system is the only way the nation's military can become a truly efficient operational force.

"The increasing cost of personnel, and the challenges of recruiting and retaining qualified individuals, will, we believe, inevitably require reductions in the size of the active force," states the 432-page report, released today. "This shrinking active force will necessarily be accompanied by an increased reliance on reserve forces for operations, particularly for homeland missions. The overall effectiveness of those forces will depend on greater integration of the reserves with the active component."

The commission argued that modifying 20-year retirements would give the services an incentive to retain service members whom they want to keep beyond 10 years but less than 20. Additional pay or bonuses would be needed to keep such troops in beyond 10 years in order to maintain retention rates.

"As part of the reformed retirement system, retention would be encouraged by making service members eligible to receive 'gate pay' at pivotal years of service," the report said. "Such pay would come in the form of a bonus equal to a percentage of annual basic pay at the end of the year of service, at the discretion of the services."

In addition, the report said Congress should expand current law to permit all service members to receive up to 5 percent of annual basic pay in matching government contributions to the Thrift Savings Plan. Service members currently receive no government matching funds for TSP contributions.

"The government's contribution would vest at 10 years of service, and the Thrift Savings Plan benefit would be portable and thus capable of being rolled over into a civilian 401(k) account," the report said. Among the report's other recommendations:

The military's promotion system should be competency-based versus time-based.

Active and reserve officer personnel management systems should be merged into a single system.

The number of duty statuses should be reduced from 29 to just two - on active duty or off.

The Defense Department should implement a combined pay and personnel system to eliminate problems with incorrect pay, low data quality, multiple personnel files and inaccurate accounting of credit for service.

"We need to look at our manpower assets with a totally integrated approach," said Arnold Punaro, chairman of the commission, which has spent more than a year compiling its report.

The recruiting and job market landscape has shifted in dramatic ways, the commission said, which means the Defense Department "must recruit, train and maintain a technologically advanced force in an era that will be characterized by ever-increasing competition for a shrinking pool of qualified individuals whose expectations about career paths and mobility are changing dramatically."

"The reserve components' role in such a new strategy will be key," the report states.

For active as well as reserve service members, such a system would create a "seamless" transition to and from active duty - "on-ramps" and "off-ramps," as Navy personnel officials have described the concept. Basing promotions on competency rather than time would keep troops competitive within the system.

The 95 recommendations in the report also include a call for the reserves to be reorganized into two formal categories: operational and strategic reserve forces.

The operational reserve would consist of Selected Reserve units and individual mobilization augmentees who would deploy periodically. The strategic reserve would include Selected Reserve personnel and augmentees not scheduled for rotational active-duty tours and the "most ready, operationally current and willing members of the Individual Ready Reserve."

The commission also calls for eliminating today's Standby Reserve category and said members who are not "viable mobilization assets should be excluded from the total reserve force."

The Defense Department would have to consistently provide the support needed to ensure the sustained viability of both forces, and Congress and the Pentagon would determine the missions each would perform.

"There used to be an understanding that if you were ready for the away game, you were ready for the home game," Punaro said. "Most everyone admits that's not the case anymore. We need a very ready force at home in peacetime, just like we need a ready force for the overseas mission."

The reserves were conceived as a strategic force that would only be called to active duty in national emergencies. But they have morphed over the past 18 years, beginning with the 1991 Persian Gulf War and spurred by the military drawdown of the 1990s, into an operational reserve that now regularly is called upon to meet the demands of the wars in Iraq and Afghanistan.

"It's clear that if you hadn't had an operational Guard and Reserve, you'd have had to go back to the draft, which I think everyone agrees is pretty unacceptable," Punaro said.

The commission concluded that the reserves will play a "growing role" as an operational force in the coming years and that properly organizing and supporting citizen-soldiers is "well worth further investment to secure our nation's future."

The commission also called on Congress to mandate that the Guard and reserve "have the lead role in and form the backbone of Defense Department operations" within U.S. boundaries; that the department should ensure such forces "are manned, trained and equipped to the highest levels of readiness"; and that the department should develop protocols to allow state governors to direct federal military assets responding to an emergency, such as Hurricane Katrina.

"The homeland threat is real, and the Guard and Reserve has a significant operational advantage over the active component because they're located in 3,000 communities around the country - plus, they have the crossover skills needed," Punaro said.

"Because you don't need that every day, it's an economic bargain for the taxpayers to have that capability forward-deployed in the communities."

The commission also made a number of suggestions that would improve benefits for reservists. It asked Congress to allow reservists who have been activated for a specified period of time to use their Montgomery GI Bill benefits after their discharge if they remain subject to recall and supply the Defense Department with accurate contact information. Current law does not allow reservists to use the benefit if they transfer from the Selected Reserve to the Individual Ready Reserve.

Punaro said he is "very bullish" on the prospects for the commission's work to receive serious attention.

He said Defense Secretary Robert Gates is "very, very concerned and supportive of all these homeland missions. Half of the 95 [recommendations] can be done immediately."

Forty will require congressional or presidential action, according to the report.

In the short term, Punaro said, U.S. Northern Command, which is responsible for command and control of the military's homeland defense efforts, needs to meet with the Homeland Security Department to discuss requirements needed to respond to DHS's 15 National Planning Scenarios.

"There hasn't been enough progress on this," Punaro said.

DoD should also identify the reserve forces that would be given the mission of catastrophic response, and then properly staff, equip and train them.

"There's nothing keeping anyone from getting started on those immediately," Punaro said.