Categories: Fedweek

Many Ideas Could Be on Table

The House plan called for setting employee and government contributions toward retirement benefits at equal amounts, meaning an increase in the employee share of about 5 percentage points, and switching to a less generous inflation measure for federal retirement, Social Security and numerous other programs. It also assumed the end of the student loan repayment authority that agencies can use as a recruiting and retention tool and repeal of the “special retirement supplement” for FERS employees who retire before age 62, effective with those retiring in calendar year 2014 and after; the supplement duplicates a Social Security benefit until that benefit can begin. Further, the plan called for reducing the workforce by 10 percent by filling of one out of three vacancies, with an exemption for national security-related positions. Also projected were further savings from employee compensation that most likely would have to come from the retirement and/or health insurance programs, the two big-ticket federal benefits. The Senate version contained no similar provisions, but the White House budget plan did endorse the COLA formula change as well as an increase in employee contributions toward retirement, of 1.2 percentage points, phased in over three years. Similar options were before the “super committee” that met in late 2011 but which failed to reach an agreement, opening the door for the sequestration.

 

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