The US Debt Ceiling is dominating the news, and with good reason. If the US doesn’t reach an agreement to increase the debt ceiling soon, the US will no longer be able to borrow money, and the government will effectively shut down. This is the same problem the government ran into a few months ago, and now the cash reserves and extensions have run out. The government needs to reach an agreement by early August, or it’s possible many government employees won’t get paid, and also possible that many individuals who receive government benefits (including many military and veteran benefits) might not get paid. What does this mean for the average American, and more importantly, what does it mean for our men and women in uniform?
What Happens if the Government Shuts Down?
First, let’s start with a little background on the situation: The US government is required to pass a spending bill each year. Essentially, this is their budget – without it the government ceases many operations and as a result, many government agencies will stop work and many will stop paying employees. The current spending bill ends this Friday, April 8th, and without passing a spending bill, the government will essentially shut down.
Will Military Members Get Paid?
The answer is yes, and no. Military members will receive their paycheck on August 15th, but there is the possibility that service members won’t get paid beyond August 15th if the government shutdown extends beyond that date. The last time the government had a major shutdown was in 1995, and military members continued to work and receive pay during the government shutdown.
What does this mean for military members? The first thing to consider is that this hasn’t happened yet – the government has until early August to reach an agreement on raising the debt ceiling. Should they fail to reach a new agreement on the debt ceiling, it is possible that the government could be positioned to shut down.
How much will you be paid, and when? If the government shuts down, you will receive your pay earned through the date at which the government shuts down. At this time the deadline is August 2nd, which wouldn’t make for a very large paycheck on the regularly scheduled August 15th payday.
Military members will receive back pay. If the government shuts down and military members don’t receive paychecks, they will receive back pay for missed paychecks.
Some service members may not be required to work. Some military members may be exempted from work, but not everyone. During the government shut down, most government employees will be temporarily furloughed and will not be required to work until a spending bill is passed. However, there are exemptions, especially for those whose work is required for national security. These groups of military members will be broken into exempt and non-exempt categories. So operations in war zones, earthquake relief in Japan, and many people involved in fields such as medical, security, and transportation will continue to work.
What about other benefits? Benefits related to your pay, such as BAS and BAH will not be paid during a potential government shutdown, however, other benefits may still be around, such as health care. Military members may also be forced to cancel leave because technically the government is not allowed to permit government workers to take paid leave while there is no spending plan, due to the way paid leave works from an accounting standpoint. At this point, much is still in the air, and these concerns may not have all been determined at this time. The Pentagon is awaiting more information before releasing official guidance for military members and their families.
Military related payments not expected to stop. The government shut down will only affect paychecks for government spending which must be approved on an annual basis. Some military related payments are made from a separate pot of money and likely won’t be affected. The following payments are expected to continue without interruption:
- Military retiree pay
- GI Bill benefits
- Veterans receiving monthly disability and compensation payments
What about Social Security Benefits or Veterans Health benefits? During the last shut down, the government continued sending Social Security Benefits to recipients. However, many veteran health care services were curtailed during the shutdowns. At this time it is unknown what will happen with these services. if the government shuts down.
UPDATE: Here are some tips for Dealing With a Missed Military Paycheck. These tips can show you how to get by on your own or how to contact your lender, landlord, or financial aid service to get help with this situation.