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10 additional ships being added to our force structure in fiscal year 1989. The 9,600 end strength growth has been eliminated from our fiscal year 1989 amended budget submission. This reduction in planned growth was achieved, in part, by decommissioning the 16 ships, decommissioning the 14th Carrier Airwing and two SSBNs. With no manpower growth in fiscal year 1989 we have had to offset required increases in combat forces of 2,171 by reductions of 1,005 in shore support and 1,166 in the student and transient account. Our fiscal year 1989 amended budget reflects a balanced and executable program which provides manning at 92 percent of requirements in combat forces to ensure fleet readiness and sustainability.

ENLISTED PROMOTIONS

Senator Wilson. In your formal statement, you delineate the problems the Air Force is experiencing in the area of enlisted promotions. This is one of those problems which arises when Congress refuses to pay for the existing force structure and is the kind of problem which can lead to the conditions of the late 1970's-our most qualified and experienced personnel just get fed up and leave active duty. Would you describe the problem, how we got there, and what needs to be done to "fix" it?

General DILLINGHAM. Maintaining an environment in the Air Force which fosters high productivity in our enlisted force is a high priority of senior leadership. One of the most important aspects of such an environment is the opportunity provided to our NCOs for advancement. When there are significant reductions in force size or funding levels, or arbitrary promotion caps applied to the force through budgetary actions, flows of promotions are affected. Selection opportunities decline; monthly pin-on numbers shrink. In 1987, when an appropriations bill capped grades after annual selections had been made, promotion lists took longer than a year to exhaust and selection rates the following year were sharply diminished. Those individuals with ambition, drive, and enthusiasm view this lowered promotion opportunity as a roadblock to achieving increased responsibility. Generally, this affects our bestthose we most want to keep. Individuals must believe their efforts in defense of our country are appreciated. If not, they will find alternate ways to earn their livingas they did in the late 1970s.

During periods of large reductions in the total force size, as we are experiencing in 1988 and 1989, the career force increases in proportion to the first-term force, because strength reductions are taken largely through lower accession levels and early separation of first-term airmen. The size of the career force is largely unaffected. This is due to a higher propensity of career force members to remain on active duty and our commitment to avoid involuntary separation of those who have served faithfully and well over longer periods of time. In order to stabilize promotion flows in the NCO grades, NCO grade strengths must also remain largely unaffected in the short run. Since total strength is declining, NCO strengths as a percentage of the total must rise slightly; however, actual numbers need not increase. In fact we have programmed decreasing numbers on our top five NCO grades in 1989 and 1990– decreases to the levels we feel provide the minimum acceptable promotion opportunity. As the force size stabilizes, NCO grades as a percent of total force can also begin to stabilize. Stable and predictable promotion flows assist us in maintaining our most talented people during this period of force turmoil.

HOUSEHOLD GOODS WEIGHT ALLOWANCES Senator Wilson. (1) Am I correct that there are no funds in the budget for improving weight allowances, and (2) if so, how much importance should we give this issue if the services will not budget for improvements?

General DILLINGHAM. You are correct that no funds are in the current budget for improving weight allowances. In fiscal year 1986, the Department of Defense (DOD) requested Household Good (HHG) weight allowances be increased to offset out-ofpocket cost to service members resulting from overweight charges. The increase was not funded. The General Accounting Office (GAO) and DOD were directed to report on this issue. GAO's report indicated that some Service members were shipping household goods in excess of prescribed ceilings, but found data insufficient for establishing new weight allowance. The DOD report recommended separate allowances for service members with and without dependents and increases for service members with dependents only. These increases were not funded. Section 651 of the Report of the Committee on Armed Services, U.S. House of Representatives, on the National Defense Authorization Act for fiscal year 1987, required DOD to submit a plan to Congress to restructure HHG weight allowances for service members. The report was submitted on April 28, 1987. The report verified our previous findings. Service members and their families absorb significant out-of-pocket expenses as a result of current HHG ceilings. Fair, realistic weight allowances cannot be funded within existing resources. The report recommends that in fiscal year 1990 Congress fund HHG ceilings which meet 95 percent of the shipment weight needs of service members. The Air Force fully supports any improvements to ease the burden on members that are directed to move in the interest of national security.

PILOT RETENTION

Senator Wilson. First, am I correct that there is a significant difference in retention rates among various aircraft communities, and if so, why?

General DILLINGHAM. The Air Force does have a variance in retention rates by weapon system group. These differences are reflected in both the cumulative retention rates and in the many years of service after training. The following shows the ten year averages for each of these retention measurement factors:

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TARS (Total Active Rated Service) equals man-years after training.

A number of factors contribute to these differences. Historically, the weapon system areas with similar missions and equipment to the airlines (strategic airlift: C-141, C-5, etc. and tankers: KC-135) have had lower than average retention.

At the other end of the retention spectrum, the fighter and bomber groups have had retention rates above the average. Pilots flying these systems may have a higher identification and desire to continue performing their unique combat roles. In both cases, it is impossible to find comparable flying experience in the civilian sector.

The trainer and helicopter groups are both relatively small and have unique characteristics. Within the trainer group, pilots that serve a first assignment as an instructor pilot in training command and then turn down follow-on major system training are counted as trainer losses. Loss of these pilots may be based upon not receiving their first choice of assignment or may be due to reluctance to accept additional service commitments associated with training. In the helicopter area, the unit structure, mission, and reduced airline draw contribute to the higher than normal retention rates.

While historical differences exist in weapons system retention, the trends in all areas show the adverse impacts of today's retention environment. A review of historical trends reflects the universal nature of the Air Force retention problem:

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The key factor is not the variance between weapons systems but the fact that all weapons systems have experienced declining retention rates since fiscal year 1983 and all except helicopters have rates below that which is required to sustain the inventory to meet requirements.

Senator Wilson. Second, is the Air Force prepared to target any retention incentive program to only those communities experiencing shortages, and if not, why not?

General DILLINGHAM. The Air Force plans to target Aviator Continuation Pay (ACP) to the retention critical areas of our aviator force. Only fixed wing pilots (no helicopter pilots and no navigators) between their 8th and 13th year of service will be eligible for ACP contracts in exchange for an obligation to serve through 14 years. These eligibility criteria are much more restrictive tha the legislation guidelines and will limit the eligible population to less than 20 percent of Air Force aviators.

END STRENGTH

Senator Wilson. General, the Marine Corps requested end strength for fiscal year 1989 is some 2,400 less than that authorized in fiscal year 1988. Yet, it appears there are no plans to deactivate any units in the Corps. This means that the existing force structure will be maintained as a lower level of manning.

Am I correct that no force structure changes are planned?
How will the manning reductions be spread throughout the Corps?

Can you quantify the adverse effect on combat readiness this reduction will have on the Corps?

General HUDSON. We do plan force structure changes in the near future. The end strength reduction will initially reduce manning of the current structure until we finalize structure changes recommended by our recently completed structure review. This review confirmed that we cannot properly man the desired structure with the reduced fiscal year 1989 end strength. The end strength reduction of 2,900 from our programmed fiscal year 1989 end strength will force us to cadre three reinforced infantry battalions or 11 percent of our infantry combat power.

Senator GLENN. The hearing will stand in recess subject to the call of the Chair.

[Whereupon, at 12 noon, the subcommittee recessed subject to the call of the Chair.]

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DEPARTMENT OF DEFENSE AUTHORIZATION FOR APPROPRIATIONS FOR FISCAL YEAR 1989

THURSDAY, MARCH 24, 1988

U.S. SENATE,
MANPOWER AND PERSONNEL SUBCOMMITTEE,
COMMITTEE ON ARMED SERVICES,

Washington, DC.
RECRUITING, RETENTION, AND COMPENSATION
The committee met in open session, pursuant to notice, at 10:30
a.m., in room SR-222, Russell Senate Office Building, Senator John
Glenn (chairman) presiding.

Present: Senators Glenn, Symms, and McCain.

Staff_present: Patrick A. Tucker, minority counsel; David S. Lyles, Frederick F.Y. Pang, and Patricia L. Watson, professional staff members; Debra A. Rice, staff assistant.

Also present: Phillip P. Upschulte and Milton D. Beach, assistants to Senator Glenn; Jeffrey B. Subko, assistant to Senator Exon; Richard Roberts and Terrence M. Lynch, assistants to Senator Shelby; Samuel J. Routson, assistant to Senator Symms; and Anthony H. Cordesman, assistant to Secretary McCain.

OPENING STATEMENT OF SENATOR JOHN GLENN, CHAIRMAN

Senator GLENN. Before proceeding, I am sorry we had to set the hearing back a little bit this morning because we had other commitments here and a classified meeting of the committee over in the other building. We had to get on with that first this morning, and we had to set this hearing back a little bit. It was either that or cancel it, and I did not want to do that.

We do have a great deal of material to cover, and we want to make sure we do a thorough job of covering it. I hope it does not turn out that we are not able to do all of it this morning. If we are unable to get through everything this morning, we might have to schedule a follow-up hearing. I hate to do that. I know you have busy schedules, as do I; however, we want to make sure we get everything covered.

The Subcommittee on Manpower and Personnel meets this morning to continue its review of the manpower portion of the revised Department of Defense budget authorization request for fiscal year 1989.

The first part of the hearing today will focus on the recruiting, retention and compensation programs of the military services. The second part will focus on reserve and guard programs.

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