Obama says no to 401k plans for troops

President Barack Obama and Japanese Prime Minister Shinzo Abe review the troops on the South Lawn of the White House in Washington, Tuesday, April 28, 2015, during a state arrival ceremony. (AP Photo/Andrew Harnik)
– The Washington Times – Thursday, April 30, 2015

The president announced on Thursday that he does not support the blended military retirement plan recommended by a commission of experts earlier this year, just one day after Housemembers included it in their fiscal 2016 defense policy bill.

President Obama said that while he supports 10 of the 15 recommendations from the Military Compensation and Retirement Modernization Commission, he could not support the proposal to have troops contribute to a 401k-like savings plan that would be matched by the government in an effort to offer some retirement benefits to troops who don’t serve 20 years.

Defense Secretary Ashton Carter echoed the president’s remarks, saying that the department will continue to analyze the rejected reforms, including the retirement changes, over the coming months.

“The choices we face about military compensation are both vexing and critically important,” Mr. Carter said in a statement. “DoD will continue to work closely with the Congress and thecommission to achieve the goals we share: ensuring the long-term strength and vitality of our all-volunteer force, and honoring all our servicemembers.”

The president said he did support implementing the majority of proposals, including better collaboration between the Defense Department and VA, improved child care and mandatory transition assistance.

The commission warned against implementing only certain pieces of their recommendations when they introduced their full report in January, noting that lawmakers should take the 15-package reform proposal in one piece as-is to avoid any unintended effects on the budget or on maintaining an all-volunteer force.

Members of the commission stressed that the retirement reform is needed to ensure that the vast majority of service members who leave the military before hitting the 20-year mark receive some type of retirement benefit.

On Wednesday night, Lawmakers on the House Armed Services Committee voted to include implementing the blended 401k-like retirement system by Oct. 1, 2017 in their version of the fiscal 2016 defense policy bill, which still needs to be approved by the full House and reconciled by Senate negotiators.

Rep. Chris Gibson, New York Republican, introduced an amendment to put off making the drastic change for another year, urging lawmakers to use that time to listen to veterans in their districts and get veterans service organizations, who are largely against the idea, on board.

He was overwhelmingly defeated by other members of the committee, who said now is the time to implement changes.

Copyright © 2015 The Washington Times, LLC.

Read more: http://www.washingtontimes.com/news/2015/apr/30/obama-does-not-support-401k-retirement-plan-troops/#ixzz3Ypd9791k
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