Senate Passes Retirement-Trimming Budget Deal

Capitol in fog.

The Senate on Wednesday passed a bipartisan-crafted budget that eliminates certain sequester cuts to the Pentagon, but also scales back cost of living adjustments starting in 2015 for working age military retirees

The bill, which passed the House last week, will now go to the White House where President Obama is expected to sign the bill into law.

Backers of the bill say the package worked out between Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash., say the deal gives much needed relief to the Defense Department.

The Pentagon faces about $1 trillion in spending cuts over the next decade as part of 2011 deficit-reduction legislation known as the Budget Control Act. That includes almost $500 billion in reductions already planned and another $500 billion in automatic cuts.

Of the $62 billion in sequestration relief in the pact, $44 billion would be applied in 2014 and another $18 billion in 2015, according to a cost estimate from the Congressional Budget Office. That means the Pentagon would receive an additional $22 billion in 2014 and another $9 billion the following year, according to the office.

But a provision will reduce by 1 percent cost of living adjustments to the retirement pay of working age retirees. The reduction has drawn criticism from 30 veterans groups and military associations, as well as members of Congress.

In a statement released on Tuesday, Republican Sens. Kelly Ayotte of New Hampshire, Lindsey Graham of South Carolina and Roger Wicker of Mississippi blasted the military retirement provision.

"We want Congress to pass a budget, address defense sequestration, and restore military readiness, but it is wrong to try to achieve these goals on the backs of our military retirees-who have risked their lives to defend our country and who have already sacrificed so much," the three said in a statement.

MOAA considers the provision a breach of faith to men and women in uniform because it reduces retired pay, survivor benefit values and is an unfair cut in military career benefits, MOAA President Norb Ryan said in a statement.

Under the plan, he said, an E-7 in 2013 with 20 years of service would lose an average $3,700 per year by the age of 62, for a total of about $83,000. An 0-5 would be out more than $6,200 a year for a total, cumulative loss of more than $124,000, he said.

The Veterans of Foreign Wars late Wednesday vowed to continue fighting the plan to trim the retirement.

"We know the federal government needs to curb its spending, balance its budget and put an end to the sequester," VFW National Commander William A. Thien said. "But to penalize military retirees, especially those who have been medically retired as a result of wounds received defending this nation, is totally unacceptable."

Thien said the group will now work with allies in both the House and the Senate to find a solution to overcome what he called "the COLA penalty" and mobilize its membership and supporters to press Congress to support the solutions.

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