Deployments strain National Guard pay system

More than two years of constant military operations and extensive reserve deployments have essentially derailed the system used to pay Army National Guard personnel, Pentagon officials told lawmakers Wednesday.

The current system was designed to pay personnel based on their participation in periodic drills, but it has been severely taxed by the extended deployments to Afghanistan and Iraq.

"This payroll system was created for a different time," said Lt. Gen. Roger Schultz, director of the Army National Guard, during a hearing of the House Government Reform Committee.

A General Accounting Office survey of 481 Army National Guard members from six states found that 450 of them had experienced pay problems. National Guard personnel were overpaid, underpaid and paid late, according to Gregory Kutz, director for financial management and assurance at GAO. In a still unresolved situation, 34 members of a Colorado Special Forces reserve unit were mistakenly assigned an average of $48,000 in debt, according to GAO.

"Many soldiers and their families were required to spend considerable time, sometimes while the soldiers were deployed in remote, hostile environments overseas, seeking corrections to active duty pays and allowances," the report stated (GAO-04-413T).

Lawmakers lashed out at the military for the pay problems and for what they said was an inadequate response.

"The impression that I have had is that you don't really care what the GAO report says, you endure them… and then move on," Rep. Adam Putnam, R-Fla., told Pentagon officials at the hearing.

Rep. Ed Schrock, R-Va., warned that reserve personnel would not remain in uniform long if they were deployed to combat zones and then forced to deal with constant pay problems.

"We've had these hearings over and over and over again," Schrock said. "We have to make sure this gets fixed or we are going to lose them."

The problem, according to military officials, is that the Defense Department maintains separate pay systems for reserve and active duty forces.

The pay system "was designed to pay reserve and guard members for monthly drill pay," said Patrick Shine, acting director of the Defense Finance and Accounting Service. It "requires input to be made each month by the soldier's unit to certify drill attendance to initiate payment."

Further complicating the situation, once a reserve unit is switched to active duty some pay entitlements kick in automatically but others must be assigned by a pay technician. The need for human input at several levels of the pay process increases the chances of making mistakes.

"We have a process that is out of whack with reality," said Ernest Gregory, acting assistant Army secretary for financial management.

The solution, according to Gregory, is a single, integrated personnel and payroll system for the military. Last year, Northrop Grumman was awarded the contract to develop the Defense Integrated Military Human Resource System program, but that system won't be deployed until 2006. Gregory expects that it will take three years to fully field the integrated system, plus another year to familiarize pay technicians with the new program.

Northrop Grumman confirmed that the new system is scheduled to be launched in fiscal 2006 and be completed in fiscal 2007.

Until then, the Pentagon is increasing training for pay personnel and attempting to make the current system more user-friendly. National Guard pay problems should be referred to the relevant state's U.S. Property and Fiscal Officer, Gregory said.

Several lawmakers at the hearing expressed concern that military personnel in combat zones were required to deal with pay issues-sometimes while under fire.

"I don't think we had any idea that the Pentagon's Byzantine, leaky financial supply lines would stretch all the way from Bridgeport [Conn.] to Baghdad," said Rep. Christopher Shays, R-Conn.

Lawmakers and GAO officials read several emotional letters from military reservists, including a soldier stationed in Iraq who complained that on the rare occasions he was able to contact his wife, they had only enough time to discuss problems with his pay check.