A May Day demonstration took place near the US Capitol in Washington, DC on May 1, as captured in a photo by Oliver Contreras/AFP/Getty Images. Government employees, who have been dealing with efforts to reduce the federal workforce under the Trump administration, are now facing potential changes to their retirement benefits. House Republicans are proposing significant adjustments to federal workers’ retirement benefits to help finance tax and spending cuts. The House Oversight Committee recently approved a plan aiming to save $50 billion from the retirement system over the next decade.
Jacqueline Simon, the policy director of the American Federation of Government Employees, the largest federal workers union, expressed concerns about the proposed changes. She explained that the plan would increase costs for employees and reduce benefits by altering the benefit calculation formula. Union leaders fear that these cuts could prompt eligible workers to retire early to secure their current benefits.
While Congressional Republicans and President Donald Trump have long sought to revamp federal employees’ pension system, past efforts have not advanced significantly. However, in the current political climate, there is optimism that this time the policy changes might succeed. The proposed bill is still pending approval by the full House and the Senate.
Rep. James Comer, the committee’s chair, portrayed the effort as a way to save money for Americans, emphasizing that taxpayers fund a substantial portion of federal workers’ benefits. However, not all Republicans are in support of the plan, with Ohio Rep. Mike Turner opposing any reduction in federal workers’ pensions.
The committee’s approved plan includes raising the contribution rate for many current civilian and postal employees enrolled in the Federal Employees Retirement System to 4.4% of their salary. It also eliminates an additional payment for new retirees until they reach the age of 62. Additionally, pension payments would be based on the average of the highest five earning years instead of the highest three years, potentially resulting in reduced benefits for retirees. Certain employees like law enforcement officers and air traffic controllers would have exceptions to some provisions but may not receive additional pension payments until after their mandatory retirement age.
Overall, the proposed changes aim to save money and make adjustments to federal workers’ retirement benefits, with potential impacts on current and future employees.
The proposed plan to change job status for federal workers, potentially offering fewer job protections, has raised concerns among employees, especially older workers, according to union leaders. Brandy Moore White, president of AFGE’s Council of Prison Locals, representing over 30,000 correctional officers and staff in federal prisons, stated that many are feeling frustrated and deceived by the proposed changes. Some workers may face devastating consequences, such as delayed supplemental payments until reaching the mandatory retirement age of 57, impacting those who plan to retire in their 40s or 50s after years of service. Jessica LaPointe, president of AFGE’s Council 220, representing Social Security Administration workers, mentioned that a quarter of staff are eligible for retirement, with some considering early retirement to secure pension benefits. The potential financial impact is causing distress among employees, who fear the consequences of the proposed plan. To stay updated on news from CNN, you can create an account at CNN.com for access to their articles and newsletters.
