TOPICS
TOPICS
Lawmakers rap OPM on underpaid retirement annuities
Nine members of Congress have lent their weight to the issue of underpaid federal retirement annuities, in a letter sent to the Office of Personnel Management last week.
The letter expressed concern over the "serious delays in processing and approving full annuity payments to federal employees upon their retirement."
The problem is one that OPM Director Linda Springer has stated is "right at the top" of her list on how to improve her agency.
At the Excellence in Government conference last month, co-sponsored by Government Executive, Springer told the audience that some employees must wait up to six months after retiring to be paid their full annuity. Until then, they receive an estimated annuity that often amounts to much less than what they are owed. OPM gives a lump sum payment to make up the difference.
"That's a system that needs to be fixed," Springer said. "If you've moved from place to place...and by and large we've been in a paper environment for a lot of your records, it will take time for your actual annuity amount to be finalized."
Springer said the initial payout is "in the neighborhood" of 80 percent of the total owed to retirees.
The congressmen said in their letter that the discrepancy can have a negative impact on retirees' financial management, interest earned and even their ability to pay living expenses.
Reps. Benjamin Cardin, D-Md.; Tom Davis, R-Va.; Steny Hoyer, D-Md.; James Moran, D-Va.; Jon Porter, R-Nev.; Frank Wolf, R-Va.; Albert Wynn, D-Md.; Chris Van Hollen, D-Md.; and Del. Eleanor Holmes Norton, D-D.C. signed the letter.
"We are interested in how OPM intends to minimize the duration and impact of interim payments, how many retirees have experienced underpayments and how they're being notified, what OPM is doing to promote early retirement filing, and what, if any, additional resources OPM may need to be successful in this effort," the letter stated.
Springer added that fixing the system is "a sign of good management that I think American taxpayers deserve."
Chad Bungard, spokesman for the House Government Reform Subcommittee on Civil Service and Agency Organization, said members are still waiting for a response from OPM and are determined to "make sure that they get the job done."
Leaders of the National Active and Retired Federal Employees Association, an organization whose mission is to protect and improve the retirement benefits of federal employees, met with OPM officials in July to discuss the issue of underpaid retirement annuities and said they were pleased with the agency's level of commitment to change toward expediting the process.
COMMENTS
- I heard horror stories throughout my career as to how long you would be without money while your retirement was being processed. I heard 4 months, 6 months, you better have 6 months salary in the bank. When I retired on Jan 2 04 (and eligible for a pension effective the following day, payable on Feb 1), I was pleasently surprised. I received my first payment on time, in an amount approx 80% of what I was entitled to, another check on March 1 for approximately another 80% of what I was entitled to, a "catch up" check sometime in the 3rd week of March, and a statement of everything on April 1, with my check almost to the penny. Everything jibed within pennies, including my gross contribution, not subject to taxation, interim health insurance deductions, which included not only the 7% of salary as per my final pay stub, but also the 7% of military pay which I paid back to "buy back" my military time. Of course, I had all my "ducks in a row" long before I was getting out. I complained about a lot of things during my 33 years, and mostly rightly so, but I have to give my agency, and OPM credit where credit is due for this one. GovExec.com reader Posted August 16, 2005 4:35 PM
- The article doesn't say how long the problem has existed. I'll wager the problem is a old one. Ms. Springer says the problem is at the top of her list. That type of statement is sort of lame. Why not say I have a plan to assure the problem is corrected and 3-6 months from today's date it will be fixed. Again no accountability is at the root of the problem. GovExec.com reader Posted August 15, 2005 7:40 AM
- Dear Taxpayer, I don't know why anyone is surprised over the competency of OPM. For years OPM has given up its authority and its leadership in the HR community. In my opinion, OPM allowed the accountants at OMB to take over the HR functions across the entire federal government. I'm sure OPM scored very highly on their report card for handling retirement issues because on paper I'm sure the program looks great. This is only one small symptom of the much larger problem with HR across the federal government and until HR takes back a central role, we will have a government mired in waste and incompetence on personnel issues. All the CHCOs across the federal government need to be HR Professionals, not accountants. And HR Departments, including OPM, need to get back its authority and its leadership roles. Or-- you can enjoy wrestling with the GS-5 HR assistants at OPM over mishandling your retirement accounts. Or worse, with contractors who could care less with helping resolve your problems. HR Specialist GovExec.com reader Posted August 11, 2005 9:19 AM
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