WASHINGTON—Senate Governmental Affairs Committee Chairman Susan Collins (R-ME) today called for changes to two Social Security provisions—the government pension offset (GPO) and the windfall elimination provision (WEP)—which unfairly reduce retirement benefits for public service employees. During a hearing today, Chairman Collins heard testimony firsthand from a teacher, retired public employees, and police officers about the enormous financial implications of these provisions.
“Despite their difficult and sometimes dangerous jobs, these invaluable public servants often receive far lower salaries than private sector employees,” said Chairman Collins. “It is therefore doubly unfair to penalize them when it comes to their Social Security retirement benefits. We need to encourage more people to join these challenging professions—not discourage them by docking their retirement benefits.”
The Social Security windfall elimination provision reduces Social Security benefits for retirees who paid into Social Security and who also receive a government pension from work not covered under Social Security. While private-sector retirees receive monthly Social Security checks equal to 90 percent of their first $606 in average monthly career earnings, government pensioners are only allowed to receive 40 percent—a penalty of more than $300 per month.
The government pension offset reduces an individual’s survivor benefit under Social Security by two-thirds of the amount of his or her public pension. It is estimated that nine out of ten public employees affected by the GPO lose their entire spousal benefit, even though their deceased spouses paid Social Security taxes for many years. Seventy-three percent of those affected by the GPO are women. According to the Congressional Budget Office, the GPO reduces benefits for more than 200,000 of these individuals by more than $3,600 a year—an amount that can make the difference between a comfortable retirement and poverty.
To correct these inequities, Collins is cosponsoring two bills, the Social Security Fairness Act (S. 349), which would repeal the GPO and WEP, and the Government Pension Offset Reform Act (S. 363), which would eliminate the application of the GPO to those individuals whose total pension benefits are $1,200 a month or less.
“Individuals who have devoted their lives to public service should not have the added burden of worrying about their retirement,” said Chairman Collins.
# # #
|
