Ayotte: Pentagon Confirms Budget Deal Also Cuts Survivor Benefits & Combat-Related Special Compensation

Press Release

U.S. Senator Kelly Ayotte (R-NH) announced today that she has received confirmation from the Defense Department (DoD) that in addition to reducing the cost of living adjustment (COLA) for military retirees (including those medically retired due to injuries), the budget agreement that Congress passed last month would also reduce the COLA for Survivor Benefit Plans (SBP) (often for military widows), as well as Concurrent Retired and Disability Pay (CRDP) and Combat-Related Special Compensation (CRSC). This means the budget agreement will not only reduce the retirement COLA for non-disabled retirees and disabled retirees receiving a medical retirement frequently due to injuries sustained in combat, but it will also reduce the COLA for survivors under the SBP and for service members injured in combat under the CRSC program.

"The more I press the Pentagon for answers, the more I learn how egregious the military benefit cuts are in the budget deal. The cost of living adjustment cuts unfairly shortchange military retirees, military survivors, and the combat-injured to pay for more Washington spending," said Senator Ayotte, a member of the Armed Services Committee. "Those who have kept us safe and taken bullets for us shouldn't be singled out to sacrifice even more, and these cuts should never have been put in the budget agreement or passed by Congress. 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."
Based on Senator Ayotte's questions, the Defense Department has confirmed that the CRDP, CRSC, and SBP programs are affected by the annual COLA reduction. The DoD response said, "The reduction can be greatest for disability retirees since many begin receiving retired pay well before the usual military retirement age."

The Survivor Benefit Plan (SBP) is an annuity plan that allows eligible beneficiaries (commonly the spouse of the service member) to receive 55 percent of the retiree's elected amount of coverage. On the Defense Finance and Accounting Service (DFAS) website, an advantage of the SBP that is listed is that it is "inflation indexed", yet the COLA reduction in the budget agreement would undercut that advantage. According to DoD's response to Senator Ayotte, 18,741 SBP annuitants are impacted.

Combat-Related Special Compensation (CRSC) is a program that was created for disability and non-disability military retirees with combat-related disabilities. Those who qualify for this benefit must be rated at least 10 percent disabled by the Department of Veterans Affairs (VA) and meet certain other criteria. According to DFAS, this compensation is for those injured as a direct result of "armed conflict, hazardous duty, an instrumentality of war, [or] simulated war."

Concurrent Retirement and Disability Pay (CRDP) allows military retirees to receive both military retired pay and VA compensation. Service members whose injuries result in a VA disability rating of 50 percent or greater are entitled to CRDP.

Senator Ayotte introduced legislation in December - the Keeping Our Promise to Our Military Heroes Act (S. 1869) - that repeals the harmful Cost of Living Allowance reduction for military retirees that was included in the recent budget agreement that Congress passed last month (which Ayotte opposed). Ayotte's proposal would repeal and replace the military retiree benefit cuts by stopping a scheme that currently allows illegal immigrants to claim the additional child tax credit - which currently costs taxpayers billions.

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