Federal employees face potential cuts to retirement benefits as House Republicans push a new plan to save $50 billion. This comes amidst broader efforts to overhaul federal pensions, causing anxiety particularly among eligible workers. Some leaders, including Rep. Mike Turner, have voiced their opposition, calling pensions promises, not giveaways.
In a surprising twist of fate, federal workers are bracing for another potential shake-up. House Republicans are proposing significant changes to retirement benefits, ostensibly to fund their ambitious tax and spending cuts initiatives. The House Oversight Committee recently passed a plan aimed at extracting a hefty $50 billion from the retirement system over the next ten years—money that could mean changes for thousands of government employees.
Jacqueline Simon, the policy director for the American Federation of Government Employees, didn’t hold back, saying, “They’re going to charge people more for the benefit, and then they’re going to reduce the benefit by changing the formula for how the benefit is calculated.” Union leaders fear these cuts could trigger a rush of eligible workers looking to retire early to secure their current benefits.
Efforts to reshape the pension system for federal employees aren’t new—Republicans have been eyeing these changes for some time, with Trump advocating similar reforms during his presidency. But in today’s political atmosphere, where strikes of boldness are more common, the chances of this plan moving forward seem more promising.
Republican representatives are framing the alterations as a necessary step towards financial responsibility. Rep. James Comer, chair of the Oversight Committee, stated that “a significant amount of the costs associated with all of these benefits are funded by hardworking taxpayers.” Yet within the party, dissenting voices emerge; Rep. Mike Turner of Ohio recently joined Democrats in opposing these cuts, emphasizing that pensions are not just benefits—they’re commitments made to federal employees.
One of the most striking changes? Raising the Federal Employees Retirement System contribution rate for many current employees to 4.4%. For most hires from before 2014, contributions stand at either 0.8% or 3.1%, while newer hires have already been contributing at the higher rate. Throwing more confusion into the mix, under the new plan, the additional payments for retirees not yet eligible for Social Security would be eliminated, drastically affecting their financial landscape.
Another significant shift occurs in how pensions will be calculated, moving from the highest three years of earning to the highest five. It’s a change that could lead to retirees receiving thousands of dollars less annually. Thankfully, not all employees share these burdens—some, like law enforcement and key positions in Customs and Border Protection, will see different treatment, though they too face some limitations.
Federal employees are feeling the tension brewing in these changes, especially seasoned professionals. Brandy Moore White, president of the AFGE’s Council of Prison Locals, described the situation as frustrating, stating, “it’s kind of like a bait and switch.” Many in the correctional field often retire early after years of service, but these provisions could force longer work lives, and the risk of retiring before hitting the mandatory age is unsettling.
Concerns intensify even further at the Social Security Administration, where a quarter of staff members are reached retirement eligibility. Jessica LaPointe, who leads AFGE’s Council 220, reported that many colleagues are considering filing their retirement papers early to ensure they don’t miss out on their benefits. “There’s no way that I would be able to absorb that hit,” she shared, echoing the sense of urgency among employees facing this tightening grip on their financial future.
Original Source: www.cnn.com
