Slowing increases to housing and food allowances for service
members by switching a crucial benchmark could save the Pentagon billions, the
Congressional Budget Office reported Thursday.
The idea proposed in the report involves tying those
allowances to the same benchmark used for basic military pay raises.
The Defense Department is required to use the Bureau of
Labor Statistics' employment cost index, or ECI, to adjust basic pay, which makes
up 70% of the military's regular pay expenses. The only exception is when
Congress approves a bigger pay raise.
But housing allowance rates are set annually by the defense
secretary, using data on rental housing vacancies in each location. Food allowances
are set annually based on the Agriculture Department's index for food prices.
These methods combined have resulted in troops' compensation
growing beyond what the DoD envisioned, according to the CBO report released
Thursday.
The Pentagon's goal was for troops to be paid at the 70th
percentile of earnings for comparable civilians, meaning 30% of civilians in
similar jobs would earn more than troops.
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