Internal Controls Can Be Improved To Help Ensure Proper and Correct Military Retirement Payments

AFMD-84-7: Published: Feb 28, 1984. Publicly Released: Feb 28, 1984.

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GAO reviewed the retirement pay systems of the Army, Navy, Air Force, and Marine Corps to determine whether internal controls are in effect to ensure proper and correct payments to retirees and their families.

The military services maintain independent payroll systems to pay and administer benefits to military retirees and survivors. GAO found that there is a need for the military services to improve internal controls to help ensure that: (1) the Navy and Marine Corps place only authorized persons on their payrolls; (2) payments by the military services continue only if recipients retain their eligibility for such payments; and (3) payments by the military services are not made to deceased persons. Furthermore, GAO reported that military retirees have received overpayments because: (1) required offsets to military retirement pay were not made when the retirees entered the federal civil service; and (2) Veterans Administration compensation was not deducted from military retirement benefits.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: Defense will modify the use of report of existence from retirees residing in the United States to ensure better management control and more timely notice of deceased persons. Computer death matches will be conducted when cost effective.

    Recommendation: The Secretary of Defense should require the services to ensure that existing control techniques to identify deceased persons on the payment rolls are improved and to ensure that the feasibility of additional control techniques are considered, including requiring certifications of existence from retirees residing in the United States and expanding the computer death matches and performing them on a recurring basis.

    Agency Affected: Department of Defense

  2. Status: Closed - Implemented

    Comments: Defense will develop and test improved procedures for control of payments for 18- to 23-year-old survivors attending school. Enhancement will be based on Air Force management practices. Emphasis will be placed on the use of a standard form, common followup procedures, uniform steps for terminating benefits, and collection of overpayments.

    Recommendation: The Secretary of Defense should direct the services to ensure that controls over payments to 18- to 23-year-old survivors attending school are improved.

    Agency Affected: Department of Defense

  3. Status: Closed - Implemented

    Comments: Defense will test the implementation of procedures to improve control of annuitant payments. Testing will include use of scientific sampling, expansion of Air Force management practices to all military services, and enhancement of certification forms. Procedures for followup, termination of benefits, and collections will be standardized.

    Recommendation: The Secretary of Defense should direct the services to ensure that annuitants submit certificates of eligibility and, where appropriate, that payments to ineligible persons are promptly terminated and overpayments collected.

    Agency Affected: Department of Defense

  4. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of Defense should direct the services to ensure that internal controls over establishing new retirement pay accounts are strengthened.

    Agency Affected: Department of Defense

  5. Status: Closed - Implemented

    Comments: Defense will incorporate data on receipts of readjustment and severance pay within the existing database maintained by DMDC, with the cooperation of the military services.

    Recommendation: The Secretary of Defense should ensure that a central computerized data file is developed and used to identify recipients of readjustment and severance pay so that the services and the Veterans Administration can make required offsets to benefits paid.

    Agency Affected: Department of Defense

 

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