Would Overhaul Retirement System

That is the position taken by the 10th Quadrennial Review of Military Compensation. The Volume 2 report, released earlier this month, covered deferred and non-cash compensation, while Volume 1, released in the spring, reviewed cash compensation. The QMRC recommends that the Pentagon change the military retirement system to one that it says would be “less costly to the government and of greater value to the service member.” It notes that “the vast majority” of service members, according to DOD data, do not stay for the 20-year retirement, so “never receive a retirement payment.” And, it says that having a 20-year plan only makes it hard to “shape careers in ways that would better match changing service requirements.” It also wants to eliminate a perceived disconnect between active and reserve retirement, namely when members begin collecting retired pay. The QMRC has outlined a new plan that would provide a defined benefit plan, a defined contribution plan, gate pays, and separation pay. The first two would apply to all services equally, while the latter two would vary depending on requirements. Members would be vested in retirement pay at 10 years. Since such a change could have “considerable impact on recruiting and retention,” the QRMC that DOD first engage in a five-year demonstration project, enlisting volunteers of varied ranks in every service and active and reserve components.