Cuts to cost-of-living allowances ‘make it hard to just exist’, say military families in Germany

When the Pentagon announced deep cost-of-living allowance cuts this summer for service members and their families stationed in Germany, many looked at stacks of bills and were completely confused.

Spouses in Germany say it’s not an affordable place to live right now as the country is hit by soaring utility costs, decreased access to childcare and comparable gasoline prices in the United States – all caused by the lingering effects of the coronavirus pandemic, as well as Russia’s unprecedented invasion of Ukraine.

“I’ve never heard [service members or their families] talking about the job being too difficult,” a military spouse at Ramstein Air Force Base, who spoke on condition of anonymity for fear of reprisal, told Military.com. “It’s always those everyday things that the Pentagon makes too difficult. They make it difficult just to exist, just to survive.”

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The Pentagon announced last week that there will be a reduction in the Cost of Living Abroad Allowance – otherwise known as COLA – for families in the Kaiserslautern military community from June 1, as prices in the Americas are now higher than in Germany.

With approximately 50,000 service members and families, Kaiserslautern is the largest military community outside of the continental United States. It is made up of air force installations located at Ramstein, Einsiedlerhof, Pirmasens, Vogelweh and Kapaun Air Station, as well as army installations at Sembach, Kleber, Panzer and Daenner Kasernen; Landstühl; Kirchberg; Miesau depot; Kaiserslautern Industrial Center; Rhine artillery; and the Pulaski barracks.

Cost of living rates are, in part, determined by feedback from service members and their families. The most recent increase in Kaiserslautern’s military community was based on a fall 2021 survey, long before Russia’s invasion of Ukraine and widespread inflation in the United States.

Additionally, the spouses told Military.com that the investigation took place in the midst of the evacuation from Afghanistan, when the military was working around the clock to move and transport refugees.

“We were in a situation with 30,000 people on base,” Ramstein’s wife told Military.com. “No, we weren’t participating in an investigation.”

Stars and Stripes reported that the military services would slowly reduce COLA throughout the summer through October, a more phased approach than outlined in last week’s announcement. The Pentagon did not respond in time for publication to multiple questions sent in earlier this week regarding the scope of the cuts.

Tax-free COLA allowances exist to make living overseas more affordable for service members by offsetting the cost of daily expenses to make them comparable to costs in the United States. With rising prices in the United States, the gap has narrowed, leading to cuts, according to the Pentagon.

“As the strength of the dollar increases against the Euro and the cost of goods in the United States increases relative to the cost of goods in the military community of Kaiserslautern, the military can expect COLA payments to decrease. “, reads the press release.

These reductions mean that service members will have between $200 and $500 less to work every two weeks to offset their expenses.

Fears are also growing over the possibility of Russia cutting gas supplies to Europe. Germany depends on Russia for 40% of its gas supplies, according to Bloomberg, and utility increases in the country, as well as across Europe, have increased since the invasion.

The spouses said the Kaiserslautern utility, SWK, announced in a letter to their customers that natural gas would cost 21% more due to Russia’s aggression in Ukraine. SWK’s gas costs have increased by almost 50% compared to 2020.

The Pentagon, however, said service members should rely on their utility allowances instead of their cost-of-living funds to meet energy price hikes.

“Although we have seen [a] significant increase in utility costs as a result of the conflict in Ukraine, COLA surveys also do not take utility costs into account. Members receive a utility allowance to help with utility costs,” the Pentagon said in a press release.

But a military spouse in Ramstein told Military.com that their family’s utility allowance hasn’t reflected changing prices and COLA usage has become essential to closing the gap.

“Our utility allowance hasn’t changed in the three years we’ve been here,” the wife told Military.com on condition of anonymity. “So to have that variable income, such a big part…it’s a big thing to say, ‘Oh, you should just budget better for that. “”

Spouses are already facing a job crisis. Limited affordable childcare combined with a prolonged unemployment rate of 20% over the past two years has plagued military families, according to a recent study by the nonprofit Blue Star Families.

But those rates can rise dramatically when a service member is deployed overseas, as spouses face complex status-of-forces agreements that sometimes include outright bans on spousal employment, foreign tax laws convoluted, language barriers and reduced access to affordable childcare.

As a result, military spouses are often unemployed when living in foreign countries, and the COLA allowance becomes essential to supplement household income.

A wife of Ramstein told Military.com that she wants the Pentagon to recognize and correct the hardships the families face.

“It will be difficult for the DoD, I think, to hear hard truths,” the wife said. “It’s one of those hard truths. … I fear what it does to mental health. I fear what it does to food insecurity.”

— Thomas Novelly can be contacted at [email protected] Follow him on Twitter @TomNovelly.

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