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Military payroll problems

Scott Tong Apr 27, 2006


KAI RYSSDAL: Let’s say the payroll folks at work mess up, and overpay you. Cool, right? Well, yes, unless you’re in the Army. The Pentagon cut hundreds of wounded soldiers bigger paychecks than they were supposed to get. The GI’s didn’t pick up on the mistake. And now Defense Department collectors are after them. Marketplace’s Scott Tong reports.

When soldiers join the front lines, their pay goes up. There’s hostile-fire pay, hardship-post pay, family-separation pay. Much of that gets canceled when someone’s wounded and returns home — theoretically.

The Government Accountability Office found 900 cases where the Army overpaid. Jeremy Chwat is with the nonprofit Wounded Warrior Project.

JEREMY CHWAT: That money isn’t being saved by the servicemember, especially since they don’t even realize they are no longer even entitled to it. And once the military tries to collect that debt, that money’s not there.

The GAO report found several soldiers saw their credit suffer. The underlying problem is old technology, says Cindy Williams of MIT.

CINDY WILLIAMS: Unfortunately, the Department of Defense doesn’t have one, single database that tracks an individual from the time he or she talks to the recruiter until he or she becomes a military retiree or a veteran.

The payroll system doesn’t talk to the personnel system. And human beings have to input all the changes manually. That’s “labor intensive” and “error prone,” according to the report.

David Patterson of the Pentagon’s comptroller office concurs with the report. But he notes the military is building an integrated database. The project is . . .

DAVID PATTERSON: . . . on schedule and on cost. And we believe that we’ll have it up and running in December of calendar year 2008.

There is no quick fix.

After all, the Department of Defense is the world’s largest financial enterprise.

In Washington, I’m Scott Tong for Marketplace.

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