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FPCD-81-70 1 (1981-09-30)

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REPORT BY THE by °he


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Comptrol ler General


OF THE UNITED STATES


Variable Housing Allowance:

Rate Setting Criteria And Procedures

Need To Be Improved


Congress authorized the uniformed services
to begin paying a variable housing allowance
in October 1980, and it became an entitle-
ment on September 30, 1981.

The variable housing allowance is currently
based on the amounts military members say
they pay for housing. GAO disagrees with this
basis for rate setting because it has a built-in
propensity for cost growth and the potential
for abuse.

If the current basis is retained, however, GAO
believes that procedures should be revised and
clarified. GAO found that the fiscal year 1981
allowances tended to favor officers and senior
enlisted members.

GAO recommends that the House Subcommit-
tee on Military Personnel and Compensation
either introduce legislation to revise the basis
for setting variable housing allowance rates,
or clarify various aspects of the current basis.





   \ sD S 71,j



              4,


RELEASED


116660


       FPCD-81-70
SEPTEMBER 30, 1981


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