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flects the increase in the size of the active duty forces in the period 1966–1969 and further reflects the number of training and combat disabilities during those years. However, with the lower level of combat activities and the decrease in size of the Active Forces, there will be a substantial decrease in the number placed on the temporary list. As those now on the list are permanently retired, discharged with severance pay or returned to duty, the number of persons in this category will decrease.

EFFECT OF FORCE REDUCTION Chairman ELLENDER. What effect will the force reduction have on non-disability-retirement rolls?

Mr. SPENCE. Keeping in mind that'eligibility for non-disabilityretirement requires completion of at least 20 years of service, the effect of a temporary increase in the size of the Active Force followed by a reduction to the previous force level has little long-term effect on the non-disability-retired rolls. Retirements which may have been delayed during a buildup in strength take place as soon as the force reduction begins. The net long-term effect is minimal.

QUESTIONS BY SENATOR THURMOND

Chairman ELLENDER. Senator Thurmond has asked that a number of questions be answered for the record. The questions and the answers will appear in the record at this point.

(The information follows:)

RETIREMENT PAY

Question. Mr. Spence, in your statement you give FY 1972 military retirement pay at $3.7 billion. Also, you estimate an increase to $5.1 billion by 1976. On what is this estimate based?

Answer. It is based on extending the January 1, 1971 military pay increase of 7.9% and the August 1, 1970 cost-of-living increase of 5.6%, and the estimated growth in the average number receiving retired pay to 1,110,000

Question. What percent of total military pay does the retirement pay make up? Answer. In fiscal year 1970, pay and allowances for active duty military personnel totaled $18.88 billion while retired military pay totaled $2.85 billion, which is 13% of the combined total of $21.73 billion.

INDUSTRY RETIREMENT Question. Do you know how many major companies allow employees to retire after 20 years of service if they have no disability?

Answer. Retirement after 20 years of service with an immediate annuity without regard to age is a liberal provision which probably is not authorized in the private sector in many instances. I am not aware of any recent report which would give us specific information as to how many major companies have such plans. Provisions for retirement after 30 years of service without regard to age are becoming increasingly common in industry. Retirement with an immediate annuity after 20 years of service is usually conditioned, on the employee having attained some specified age.

MILITARY DISABILITY RETIREMENTS

Question. What percent of those presently retired from military service have retired because of disability?

Answer. In fiscal year 1970, the total average number of military personnel on the retired rolls was 742,584, of which 140,920 or 19% were for disability.

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RETIRED RESERVISTS Question. What percent of the retirement fund goes to pay retired reservists ucho earned retirement as "citizen soldiers' versus those who retired after a period of 20 or more years service!

Answer. In fiscal 1970, $2.35 billion were for military personnel retired for nondisability reasons with 20 or more years of service, of which $0.11 billion or 5% was for Title III ersonnel.

TABLES

Chairman ELLENDER. Is there anything further you want to add?
Mr. SPENCE. I have nothing to add.

Chairman ELLENDER. The tables to which you refer will be made a part of the record.

(The tables follow :)

NEW OBLIGATIONAL AUTHORITY, OBLIGATIONS, AND UNOBLIGATED BALANCE, FISCAL YEARS 1950-70

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1 $3,300,000 transferred to "claiins, detense."
$1,000,000 transferred to "operation and maintenance, defense agencies."
NET INCREASES BY CATEGORY IN YEAR-END STRENGTHS FROM THE PREVIOUS FISCAL YEARS 1970-72

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Fiscal year

OBLIGATIONS FOR MILITARY RETIRED PAY, FISCAL YEARS 1950–76

(In thousands of dollars) Obugations Fiscal year

Obligations
Actual :

Actual:
1950
$304, 376 1964

_$1, 211, 215
1951
324, 089 1965

1, 385, 578 1952 330, 598 1966

1, 592, 352 1953 356, 385 1967

1, 831, 159 1954 386, 298 1968

2, 093, 478 1955 422, 102 1969

2, 442, 941 1956 478, 932 1970

2, 853, 234 1957

510, 784

Estimated :
1958
560, 962 1971

3, 391, 032 1959

634, 542
1972

3, 777, 134
1960
692, 922 1973

4, 136, 900 1961 787, 806 1974

4, 497, 700 1962

895, 854
1975

4, 847, 500
1963
1,014, 775 1976

5, 197, 300

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END STRENGTHS, OBLIGATIONS AND EXPENDITURES, JULY 1970 TO FEBRUARY 1971, FISCAL YEAR 1971

(Dollar amounts in thousands

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NUMBER ON RETIRED MILITARY ROLLS AND RETIRED PAY OBLIGATIONS FOR FISCAL YEARS 1958-76

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ACTUAL NUMBER OF RETIREMENTS AMONG MILITARY PERSONNEL ON ACTIVE DUTY FOR FISCAL YEARS 1958-70

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TITLE III, PUBLIC LAW 810, RETIREES FOR FISCAL YEARS 1970, 1971 AND 1972 (10 U.S.C. 1331)

(Dollars in thousands)

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COMPARISON OF RETIRED PAY EXPENDITURES WITH DEPARTMENT OF DEFENSE EXPENDITURES

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RETIRED MILITARY PERSONNEL ELECTING SURVIVORS' BENEFITS AND AMOUNT OF DEDUCTION FROM RETIRED

PAY BY CATEGORY

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