House budget proposal pushes civil pension reform

A 2018 budget resolution by House Budget Committee chair Diane Black (R-Tenn.) calls for federal employees to contribute a greater amount of their salaries to the government’s defined benefit retirement plan.

“This [budget] would achieve significant savings while recognizing the need for new federal employees to transition to a defined contribution retirement system,” the resolution states. “The vast majority of private sector employees participate in defined contribution retirement plans.”

The budget resolution claims to incorporate pension reform recommendations from the so-called “Simpson-Bowles” commission, named after former congressmen and co-chairmen Alan Simpson and Erskine Bowles.

The commission, formed by President Barack Obama (D) in 2010 to much fanfare, was designed to tackle and solve larger issues of federal spending, revenue and debt. However, lawmakers on both sides of the aisle blanched at the massive tax increases, spending cuts and welfare reductions included in the final recommendations, and the commission’s report eventually faded into obscurity.

Among their cost-saving proposals was a plan to reform civil service pensions by increasing the number of earnings years used to calculate pension benefits, deferring cost of living adjustments for early retirees and adjusting the ratio of employer/employee contributions.

Reader comments

Tue, Aug 1, 2017 Ned Ward

On an inflation adjusted basis, general schedule federal employees are paid less today than 30 years ago. If you study the matter, you will find the people who devised defined contribution plans always imagined that they would complement defined benefit pensions and not replace them. As Eisenhower warned, the military-industrial complex now has the federal government by the wallet. Security, like prosperity, begins at home.

Fri, Jul 28, 2017

We have no one that actually stands up for us workers. The unions are just another form of hot air along with our elected officials, management and political minons.

Thu, Jul 27, 2017

July 19th comment by Farmer has NO clue! July 20th comment is SPOT ON! IF there is a Federal reform, then it should be for everyone, e.g., military, Congressmen/women, etc., as we are all federal employees. Cut my benefits and I might as well go back to the Industry, because I make $80,000 a year as a Civil Service employee, but my counterpart on the Contracting side, makes $150,000 a year!

Thu, Jul 27, 2017

Republicans HATE federal workers and for decades have done nothing but degrade and discourage their unselfish patriotic contributions and support for the citizens of America. This is another Republican attempt to allow harm on true American citizens that will only profit the 1%.

Thu, Jul 27, 2017

So the Republicans want to take away the FERS Supplement. OK, that $12,000 +/- per year loss will keep me from retiring before age 62. So instead of paying me the before mentioned $12,000 per year, the Republicans will have to pay me my full salary which is 5 times more until I do qualify for Social Security. Takes a real math wiz to figure the benefit in that.

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