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OPM lays out proposed changes to fed benefits

Office of Personnel Management Director Jeff Pon has proposed changes to federal employees’ retirement benefits to more align them with that of the private sector.

In a letter to House Speaker Paul Ryan (R-Wis.), Pon proposed four main changes to federal employee retirement benefits that will affect 2.6 million federal retirees and survivors who receive monthly annuity payments:

1) Eliminate the Federal Employees’ Retirement System annuity supplements for new retirees and survivor annuitants;

2) Increase the Civil Service Retirement System and FERS average pay period to five years from three years;

3) Increase FERS employees’ contribution to their retirement to one percent each year until they reach 7.25 percent of basic pay; and

4) Reduce or eliminate retirement cost-of-living adjustments.

The agency expects to save an estimated $143 billion over ten years if all four proposes are enacted.

“The Office of Management and Budget (OMB) has advised there is no objection to the transmittal of these legislative proposals to the Congress and that their enactment would be in accord with the program of the president,” Pon said in the letter.

He asked that Congress give “prompt and favorable” consideration of the proposals.

Read the full letter and more details on each proposal here.

Reader comments

Fri, Jun 1, 2018

Maybe stop the funding to the state & local agencies. After all, they make twice as much as Feds in my area. With MUCH better benefits at a very low cost, some even free!

Fri, Jun 1, 2018

Stop using employees to balance the budget! Every Oct I have to worry if I’m going to receive a paycheck. Eleven months to complete and it’s always at the final hour.

Thu, May 31, 2018

The private sector is run & funded by share holders (for profit). Federal employees are run & funded by the tax payers.

Can’t compare the two. Two TOTAL different entities.

Thu, May 31, 2018

I’ve been NEGATIVE in pay for the past 6+ years! Capped out at grade 7 step 10. Whatever little raise I did receive went directly to healthcare cost!

Sat, May 26, 2018

Article title is not descriptive - it should be "OPM lays out proposed CUTS to fed benefits"

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Edward A. Zurndorfer Certified Financial Planner
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Mathew B. Tully Legal Analyst

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