Proposal would make lawmakers wait longer to tap pensions
Rep. Bobby Schilling, R-Ill., on Friday introduced a bill that would tie lawmakers' access to their federal pensions to the Social Security retirement age. Currently, members of Congress do not have to wait until they are 65 to 67 years of age, depending on year of birth, before receiving annuity benefits. Sen. Sherrod Brown, D-Ohio, in April introduced similar legislation.
Under the Federal Employees Retirement System, lawmakers are eligible for an immediate, full pension at age 62 or older if they have completed at least five years of service; they are eligible at age 50 or older if they've served 20 years, or at any age after completing 25 years of service. Under the Civil Service Retirement System, members of Congress are eligible for an immediate, full pension at age 60 or older after one decade of service, or at age 62 after five years of federal service.
Lawmakers typically become eligible for retirement annuities at an earlier age and with fewer years of service than most other federal employees, but they also pay more of their salary for retirement benefits. The more generous annuity that lawmakers receive far outweighs the extra they have to pay in, said Pete Sepp, vice president for communications and policy at the National Taxpayers Union.
According to Sepp, the pension costs for lawmakers below the Social Security retirement age are difficult to calculate, but the proposal could save taxpayers several million dollars annually. The bill also could lead to long-term savings through a complete restructuring of retirement benefits, he said.
"By showing some leadership-through-example now, passage of the legislation could help to hasten a consensus on Social Security reform sooner, sparing taxpayers some of the massive burdens associated with unfunded liabilities in the program," Sepp said.
Federal employee pensions also are under fire amid negotiations to reduce the deficit. In addition to ongoing discussions to increase workers' share of FERS contributions, the House-passed version of the fiscal 2012 budget resolution included a recommendation that would require federal employees to pay for half the defined benefit they receive with their pensions at retirement. Most employees currently contribute 0.8 percent of their salaries and agencies pay 11.7 percent, with the agency contribution set to increase to 11.9 percent in October. According to union leaders, these proposals would result in a significant payroll tax increase without any improvement in benefits.
Lawmakers also are using changes in pension benefits to discourage corruption among their own ranks. Sen. Mark Kirk, R-Ill., and Rep. Robert Dold, R-Ill., recently introduced legislation that would add 20 public corruption offenses to an existing law that cancels federal pensions for convicted lawmakers and revoke the pensions of former members of Congress who are convicted of committing these crimes while serving as elected officials.