"...Last November an independent audit of the Military Retirement Fund uncovered a “significant deficiency” in the way the Defense Finance and Accounting Service (DFAS) has been calculating retired pay for about 15 percent of 370,000 retirees who are under a “High-3” retired pay formula.
The result is that 55,500 retirees who first entered service on or after Sept. 8, 1980, have been getting a little less in monthly retired pay than the law directs. That’s because DFAS, for this High-3 generation, has not been applying a pay protection tool from 1975 called the “Tower Amendment.”
If DFAS were to apply Tower protection retroactively, as auditors recommend, these retirees could expect a lump sum average payment of about $1000, the Congressional Budget Office reports. Individual amounts would vary base on time retired, with the largest payments going to those who retired in fall of 2000 with the first wave of “High-3” retirees.
But if the Department of Defense has its way, DFAS will never have to make those payments..."