$1.8-Billion Cut Urged for Pentagon Pensions

The Senate Armed Services Committee on Wednesday recommended that $1.8 billion be trimmed from the Pentagon’s contribution to a new military retirement trust fund but insisted that the reduction would not result in pension cuts for current military retirees or those now in the armed forces, Senate sources said.

The trim was included in a revised version of the Pentagon budget as the committee tried to bring the spending plan that it had recommended April 4 into line with last week’s action by the Senate, which would allow defense spending to grow at the rate of inflation. The committee had recommended a 3% after-inflation increase in fiscal 1986, which begins Oct. 1. Inflation is expected to be about 4%.

Thus, the panel needed to cut about $9 billion from the $304-billion Pentagon budget that it had suggested, and sources said it achieved that goal through relatively small cuts in a variety of programs without eliminating any major weapons programs.

Funds to Close Bases

But, in a unique twist, the panel added $1 billion not sought by the Pentagon to do something Congress has never wanted it to do before: close military bases. The Pentagon has estimated that it will need $2 billion next year to begin initial work in closing unnecessary military facilities--a step that had drawn adamant congressional opposition in earlier years.

According to Senate sources, the panel recommended cutting $450 million from its earlier recommendation of a $3.4-billion budget for research on the space-based Strategic Defense Initiative, commonly known as “Star Wars.”

But one source said: “There are no big-ticket items that dropped off the cliff.” The committee recommendations now will be sent to the full Senate.

The Senate sources, who spoke on the condition of anonymity, said the committee approved a 10% cut in next year’s contribution to the “retirement accrual account,” for which $18 billion had been included in the budget that it prepared last month.

The pension fund was established in the current fiscal year to keep money for retirement benefits apart from general Treasury funds.

The panel, while telling the Pentagon not to cut the pensions of current beneficiaries or members of the armed forces, recommended that pension cuts, if they must be made, come from pensions that would be collected more than 20 years from now--thus, from persons who have not yet entered the military.

‘May Be Less Incentive’

However, Pentagon spokesman Michael I. Burch argued in an interview that the effort to trim future pensions could hurt recruiting and that “once a person joins, there may be less incentive to remain” in the military.

The Senate committee tackled the budget as the full House began debate on its version of the Pentagon spending plan.

Meanwhile, Defense Secretary Caspar W. Weinberger said he was taking another look at the budget, in the wake of last week’s Senate vote, to seek additional savings. Pentagon comptroller Robert Helms was dispatched to the committee meeting.

Serious Impact Cited

But the Pentagon announced that the review has convinced Weinberger “that the new budget levels cannot be accommodated without seriously impacting the defense program.”

The Pentagon said that through “management improvements” and lower inflation, it has spent $4 billion less in fiscal 1985 than had been expected.

Weinberger’s announcement annoyed some Republican defenders in the Senate, as well as Democrats. A spokesman for Sen. Pete Wilson (R-Calif.) said: “It’s good they’re achieving some savings, but the timing and manner in which this announcement has been made is extremely poor. The Armed Services Committee has been trying for 3% real growth. The appearance of this report gives the impression there was always money there.”