**GAO-10-803R**                      Published: Jun 03, 2010. Publicly Released: Jun 03, 2010.                  

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## Highlights

GAO testified before a Congressional subcommittee on April 28, 2010, to discuss current issues related to military compensation. This letter responds questions for the record from the hearing. (1) Is the ECI an appropriate index to use to adjust military basic pay rates annually? If not, is there a benchmark that is more appropriate? (2) Please explain what the impact on the Defense budget would be if Congress directed an increase in the pay raise by one percent, or half a percent without offsets. (3) Is there a better metric than the ECI to gauge what an annual pay raise should be? (4) Does the current pay table need adjustment? (5) What do you think the effect of reducing the requirement for entitlement to retired pay below 20 years would be on the ability to retain the personnel we need in leadership positions in the Armed Forces? (6) Last year, the Navy Exchange Service Command generated more than $45 million in dividends. These figures seem to indicate that commissary and exchange benefits are not especially costly to DOD and that service members place a high value on these benefits. How can these figures inform the Department in maintaining a competitive cash and non-cash compensation package for service members and providing it in such a way that is affordable to the Department?

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## GAO Contacts

Brenda S. Farrell
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Sarah Kaczmarek
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## Topics

Human Capital

AccountabilityCost analysisData collectionMilitary compensationMilitary forcesMilitary payMilitary personnelComparative analysisCompensationMilitary retirement