Pay and Benefits Watch: Hopes for Social Security reform

Federal retirees hope this month's congressional repeal of the earnings test for Social Security beneficiaries is just Act I of a three-act play to improve their retirement benefits.

Under H.R. 5, which passed both the House and Senate unanimously and is now awaiting President Clinton's signature, senior citizens who reach retirement age will be allowed to continue working without any reduction to their Social Security benefits.

For federal retirees who worked their entire careers under the Civil Service Retirement System, the earnings test repeal is of little interest, because they do not receive Social Security benefits. For retirees who worked part of their careers in the private sector or are covered by the Federal Employees Retirement System, the passage of H.R. 5 means more money in their pockets if they choose to keep working past age 65.

The day after Senate passage of H.R. 5, the National Association of Retired Federal Employees issued a press release pushing for the elimination of two other Social Security provisions that reduce benefits: the Government Pension Offset and the Windfall Elimination Provision.

"Both of these provisions result in the loss of earned Social Security dollars for individuals whose working years included federal or other public service. These individuals deserve the same consideration for the value of their work yesterday as today's working seniors deserve," said Frank Atwater, national president of the association.

In 1983, Congress passed the Windfall Elimination Provision to reduce Social Security benefits for CSRS retirees who also worked in jobs that qualified them for Social Security benefits. A modified formula is used to calculate CSRS retirees' Social Security benefits. The Social Security Administration has published on its Web site a detailed document explaining how the Windfall Elimination Provision works at

The Government Pension Offset, which Congress passed in 1977, affects CSRS retirees' Social Security spousal benefits. Spousal benefits are intended for people who are financially dependent on their husbands or wives. But the way Social Security law was previously written, people who received CSRS pensions also qualified for full spousal benefits.

The offset reduces the amount of Social Security spousal benefits CSRS retirees receive by two-thirds of the amount of their government pension. For example, if a CSRS retiree receives a monthly pension of $600, their Social Security spousal benefits are reduced by $400 a month. If the retiree would otherwise be eligible for a $500 Social Security spousal benefit, the retiree would instead receive $100 a month.

The National Association of Retired Federal Employees argues that the two provisions are as outdated as the earnings test. But proponents of the provisions contend that the Windfall Elimination Provision and the Government Pension Offset prevent federal retirees from receiving more generous Social Security benefits than other retirees.

The association has been pushing repeal of the provisions for years, but its efforts have not yet borne fruit.

The association has members in every congressional district in the country. The 1,700 chapters of the association are trying to get their congressional representatives to support H.R. 860, which would reduce the effects of the Windfall Elimination Provision or H.R. 742, which would eliminate the Windfall Elimination Provision. So far, H.R. 860 has 110 co-sponsors out of the 435-member House. H.R. 742 has 51 sponsors.

The association has been more successful in drumming up support for H.R. 1217, which would alleviate the impact of the Government Pension Offset. H.R. 1217 has 218 co-sponsors in the House, while its companion bill in the Senate, S. 717, has the backing of 18 senators.

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