A pension cut for military retirees in last month's budget agreement that riled veterans groups and several lawmakers extends to survivors' benefits and special compensation for combat, the Pentagon told Congress on Monday.
Responding to questions from Sen. Kelly Ayotte, the Pentagon outlined the impact of the budget pact's 1 percentage point cut to annual cost-of-living increases. The adjustment would save $6 billion over the next decade, money that the federal government plans to use to ease cuts to the military budget this year.
The Pentagon said the cost-of-living change would affect all military retirees, including active duty, reserve and disabled, and change payments under the combat-related special compensation program. That program provides extra benefits to some retirees injured in combat.
The change also affects annuity payments under the Survivor Benefit Plan, the Pentagon said in a memo to Ayotte, a member of the Armed Services Committee and fierce opponent of the pension cut.
The Survivor Benefit Plan is an insurance plan that the military says will pay a surviving spouse a monthly annuity to help make up for the loss of retirement income. Ayotte said a surviving spouse could receive 55 percent of the retiree's elected amount of coverage.
"Those who have kept us safe and taken bullets for us shouldn't be singled out to sacrifice even more," the New Hampshire Republican said in a statement. "I am continuing my efforts to immediately right this wrong and to ensure our military retirees, survivors and combat-wounded receive the full benefits they've earned."
Service members are permitted to retire at half pay after 20 years in the military, which means they can claim their pensions as early as age 38, a generous benefit that defenders say attracts men and women to the all-volunteer force and helps retain them.
In defense of the cut, House Budget Committee Chairman Paul Ryan, R-Wis., said a typical serviceman who retirees at 38 would receive a $1.7 million pension over his lifetime instead of a $1.8 million benefit and that most working-age military retirees go on to second careers.
Faced with angry veterans' groups and lawmakers, members of Congress were working on reversing one element of the pension cut — the reduction for disabled veteran.
Congressional aides said last week that the $1 trillion-plus omnibus spending bill, expected to be unveiled this week, will reverse the cut that was inadvertently applied to more than 63,000 veterans who have left the military due to injury or disability.
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