OPM aims to release revised retirement statements by mid-April

Sen. Barbara Mikulski, D-Md., has been critical of OPM’s reform efforts. Sen. Barbara Mikulski, D-Md., has been critical of OPM’s reform efforts. Dennis Brack/Landov

A glitch in the federal retirement system that affected as many as 12,000 retirees will be fixed by mid-April, according to Office of Personnel Management Director John Berry.

OPM has been working since 2008 on a fix to its Service Credit System, which calculates retirement annuities for those who either did not contribute to the retirement fund during a certain period, or those who received a refund of retirement contributions. Berry said the agency now is testing a new system, and expects to send out revised statements with correct retirement calculations by April 15.

Currently, it can take OPM anywhere from five to 40 business days to complete an annuity calculation request, because officials must determine retirement payments manually.

Berry was responding to a Feb. 2 letter from Sen. Barbara Mikulski, D-Md., criticizing OPM and the overall retirement system in particular over the lengthy processing time related to calculating annuities.

"I know that problems with this system started long before you became director and what you inherited is scandalously wasteful and ineffective," Mikulski wrote. "But, during this terrible recession, it is unacceptable that federal employees cannot get the information they need to plan for retirement." Mikulski's state is home to many federal employees.

Other upgrades to the federal government's retirement systems, such as moving from paper to electronic records, likely will take more than a year to complete, Berry said. OPM could not provide a cost estimate for the upgrades.

"When I arrived at OPM in April of 2009, I inherited a retirement program that was and remains in need of significant repairs, despite the significant sums of money that the previous administration had spent on modernization efforts," Berry wrote to Mikulski on Feb. 22. "I have asked Deputy Director Christine Griffin to devote the majority of her time to this effort, which we would like to bring to a successful conclusion without additional wasteful expenditures of appropriated funds."

According to a 2009 Government Accountability Office report, OPM's attempts to modernize its retirement system date back to 1988. More recently, the agency has pursued initiatives such as RetireEZ and Retirement Systems Modernization. According to the report, contracts the agency signed in 2006 with Hewitt Associates, Accenture Ltd., and Northrop Grumman Corp for these initiatives cost about $360 million.

Daniel Adcock, legislative director for the National Active and Retired Federal Employees Association, said his organization still receives calls about the retirement system, but the number has dropped since OPM began its reform efforts in 2005.

"I think the reason why it's such a complex problem is that frequently, federal employees may have worked at a bunch of different agencies," Adcock said. "It's all a question of collecting the dots of their salary history and coming to the final annuity amount."

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Forecasting Cloud's Future

    Conversations with Federal, State, and Local Technology Leaders on Cloud-Driven Digital Transformation

    Download
  • The Big Data Campaign Trail

    With everyone so focused on security following recent breaches at federal, state and local government and education institutions, there has been little emphasis on the need for better operations. This report breaks down some of the biggest operational challenges in IT management and provides insight into how agencies and leaders can successfully solve some of the biggest lingering government IT issues.

    Download
  • Communicating Innovation in Federal Government

    Federal Government spending on ‘obsolete technology’ continues to increase. Supporting the twin pillars of improved digital service delivery for citizens on the one hand, and the increasingly optimized and flexible working practices for federal employees on the other, are neither easy nor inexpensive tasks. This whitepaper explores how federal agencies can leverage the value of existing agency technology assets while offering IT leaders the ability to implement the kind of employee productivity, citizen service improvements and security demanded by federal oversight.

    Download
  • IT Transformation Trends: Flash Storage as a Strategic IT Asset

    MIT Technology Review: Flash Storage As a Strategic IT Asset For the first time in decades, IT leaders now consider all-flash storage as a strategic IT asset. IT has become a new operating model that enables self-service with high performance, density and resiliency. It also offers the self-service agility of the public cloud combined with the security, performance, and cost-effectiveness of a private cloud. Download this MIT Technology Review paper to learn more about how all-flash storage is transforming the data center.

    Download
  • Ongoing Efforts in Veterans Health Care Modernization

    This report discusses the current state of veterans health care

    Download

When you download a report, your information may be shared with the underwriters of that document.