Members of military Survivor Benefit Plan get closer to full payout
By Sam Atkins
Published in News on May 16, 2004 9:11 AM
Survivors of military retirees who signed up for the Survivor Benefit Plan may finally receive what they say they are owed.
The House Armed Services Committee said it has approved eliminating the Social Security offset under the Survivor Benefit Plan by increasing the annuities paid to survivors of military retirees who are 62 or older.
"This has been a long, hard fight, and I'm very glad this bill will help so many of our most deserving military survivors by eliminating the 'widow's tax,'" said U.S. Rep. Walter B. Jones, whose district includes Wayne County.
Beneficiaries of the plan face a 20 percent drop in their annuity once they reach age 62. Thousands of these survivors were never told about this annuity cut, and they say the unexpected loss of income is financially devastating.
A Goldsboro woman felt the affects of this and became a national spokesman for veterans' spouses who are trying to get the U.S. government to pay them what they say they are owed.
Dottie Welch and her husband, Lt. Col. Roger M. Welch, moved to Goldsboro in 1988. Welch signed up for the plan in 1973. For almost 30 years, he paid into the plan to help take care of his wife after he died. When he died in 2002, she was surprised to see she was receiving much less than expected.
The plan's application said it would pay 55 percent of his retirement pay to Dottie. They had no idea that after she turned 62, the benefits would drop to 35 percent.
The government reduces the benefits to offset what the survivors receive from Social Security. The formula is a complicated one. Mrs. Welch said in an interview last year that it led to a cut of $384 a month.
The offset is not made known until after the military member's death and the problem applies to all spouses of deceased military service members who enrolled in the program when it began, she said.
The provision approved by the House Armed Services Committee would eliminate the Social Security offset under the plan and increase the annuities paid to survivors of military retirees who are 62 or older from 35 percent of retired pay to the percentages indicated for the following periods:
*For months after September 2005 and before April 2006 -- 40 percent.
*For months after March 2006 and before April 2007 -- 45 percent.
*For months after March 2007 and before April 2008 -- 50 percent.
*For months after March 2008 -- 55 percent.
Restoring the plan's equity over this period will cost $2 billion, according to Jones.
"More than 300 members of the House have signed on to support this measure, and we'll work to get this on the president's desk as soon as possible," he said.