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Military people next January would get a 3.5 percent pay raise, under a compensation package voted Wednesday by the House armed services subcommittee on military personnel.

In shaping the personnel section of the fiscal 2008 defense authorization bill, the subcommittee approved other initiatives to please health-care beneficiaries, surviving spouses and some disabled retirees forced from service short of 20 years by combat-related injuries.

The Senate will mark up its version of the 2008 defense bill later this month, no doubt approving a somewhat different set of personnel initiatives. A House-Senate conference later will smooth out the differences.

Here are details of what the House panel unanimously approved:

¶ 2008 pay raise — The 3.5 percent raise for next year would be the ninth straight set at least a half percentage point above private sector wage growth as tracked by the government’s Employment Cost Index (ECI).

The Bush administration wanted to end the string of ECI-plus-a-half-percent raises with a 3 percent hike in 2008 to match average private-sector raises. But breaking the pattern will be difficult politically during wartime, especially with a war that most lawmakers would end if they could but they can’t override the president’s veto.

Rep. Vic Snyder (D-Ark.), chairman of the personnel subcommittee, said the 3.5 percent raise continues to narrow a pay gap between the military and private sector, which stood at 13.5 percent in 1999. It now is 3.9 percent and would drop to 3.4 percent with the revised ‘08 raise.

¶ Tricare fees — Once again, the subcommittee has voted to block the administration’s plan for sharp increases in Tricare enrollment fees, deductibles and pharmacy co-payments. Rep. Vic Snyder, D-Ark., said defense officials left a $2 billion “projected savings” hole in the Tricare budget in anticipation that the department’s task force will send interim recommendations to Congress this month in time to be reviewed, approved and included in the 2008 budget. Snyder said he didn’t expect that to happen, and his subcommittee needed to fill that $2 billion funding gap. It also had to add $200 million more to the services’ health budgets to make up for “efficiency wedges” imposed by Defense budget officials. The Army, Navy and Air Force surgeons general all testified that the efficiency wedges simply were budget cuts that, if not fill, would lead to reduce health services on military bases.

¶ CRSC expansion — Eligibility for Combat-Related Special Compensation (CRSC) would be expanded for the first time to benefit a limited number of Chapter 61 retirees forced by disabilities to leave service short of 20 years. The subcommittee provision would limit CRSC eligibility to those Chapter 61 retirees who served at least 15 years, were forced from service by combat-related injuries and have disability ratings of 60 percent or higher.

Those who meet the criteria would be able to draw their VA disability compensation plus a monthly CRSC equal in value to a military retirement annuity calculated on their years actually served. For example, an eligible retiree forced out after 16 years would receive a monthly CRSC payment equal to 2.5 percent of monthly basic pay multiplied by 16 years. (This assumes they were not serving under Redux, a discounted retirement plan.)

¶ Survivor indemnity allowance — Surviving spouses unable to draw full survivor benefits because of the so-called SBP-DIC offset would begin to receive a new survivor indemnity allowance valued at up to $40 a month. It is touted as a first step toward eliminating the offset for 61,000 surviving spouses who see their Survivor Benefit Plan (SBP) reduced, dollar for dollar, by amounts they receive in Dependency and Indemnity Compensation (DIC) from the Department of Veterans Affairs. The allowance would begin Oct. 1, 2008.

Rep. John McHugh of New York, ranking Republican on subcommittee, said the CRSC expansion and the survivor allowance are modest steps, in part because the subcommittee had only sketchy cost estimates to rely on. He predicated more steps would be taken in the future to help these populations.

¶ Active force increases — Active-duty forces would increase by 46,500 over levels requested by the administration. Army strength would increase to 525,400 soldiers, or 36,000 more than requested. Marine Corps strength would climb to 189,000, a bump of 9,000. Air Force strength would be 329,563, or 963 above the administration’s request. Navy strength would be 329,098, 698 higher than the service sought.

The unusual Navy and Air Force numbers reflect a subcommittee decision to block further DoD-directed conversions of uniformed medical personnel positions to civilian contractors. Snyder said the surgeons general testified that the conversions were hurting patient access and quality of care.

¶ Reserve GI Bill — The subcommittee is taking a first step toward raising Reserve Montgomery GI Bill benefits by voting to transfer oversight for the program from DOD to the VA, where reserve benefits would be raised annually in lock step with the active-duty GI Bill benefits.

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