OPTIONS FOR REDUCING THE DEFICIT: 2014 TO 2023
|(Billions of dollars)
|Change in Revenues
Note: This option would take effect in January 2014.
The federal government provides most of its civilian employees with an annuity in retirement through either the Federal Employees Retirement System (FERS) or its predecessor, the Civil Service Retirement System (CSRS). Those annuities are jointly funded by the employees and the federal agencies that hire them. About 85 percent of federal employees participate in FERS, and most of them contribute 0.8 percent of their salary toward their future annuities. The Middle Class Tax Relief and Job Creation Act of 2012 increased the contribution rate to 3.1 percent for most employees hired after December 31, 2012. Federal employees who are still covered by CSRS generally contribute 7 percent of their salary and accrue larger annuities. Agency contributions for FERS and CSRS do not have any effect on total federal spending or revenues because they are intragovernmental payments, but employee contributions are counted as federal revenues. (Annuity payments made to FERS and CSRS beneficiaries represent federal spending.) Continue reading “CBO —Option 36 Increase Federal Civilian Employees’ Contributions to Their Pensions”
Sen. Richard Burr, R-N.C., questions current and former IRS employees May 21 before the Senate Finance Committee in Washington. (Getty Images)
Newly hired federal employees would not be eligible for traditional pensions under a bill reintroduced last week by Sen. Richard Burr, R-N.C., and two colleagues.
The measure, which would also apply to new members of Congress, would end the defined benefit portion of the Federal Employees Retirement System (FERS) for employees who come on board starting six months after it is signed into law, according to a news release from Burr’s office.
New federal employees could still participate in the Thrift Savings Plan,the federal government’s equivalent of a 401(k)-type program under which agencies match employees’ contributions up to 5 percent of their salaries.
Continue reading “Bill would end pensions for new feds”
The Public-Private Employees Retirement Parity Act was introduced by Sens. Tom Coburn, R-Okla. (left); Richard Burr, R-N.C.; and Saxby Chambliss, R-Ga. (not pictured) J. Scott Applewhite/AP
A group of Republican senators has introduced a bill to slash retirement pensions for new federal employees, saying the current system unfairly compensates public-sector workers as compared to their private-sector counterparts.
The Public-Private Employees Retirement Parity Act, introduced by Sens. Richard Burr, R-N.C.; Saxby Chambliss, R-Ga.; and Tom Coburn, R-Okla., would eliminate the defined benefit portion of the Federal Employees Retirement System for all new government workers hired six months after its enactment. New employees would still receive matching agency contributions into their Thrift Savings Plan of up to 5 percent.
“Right now, federal government workers receive far more generous retirement benefits than private-sector employees,” said Burr, who sponsored a similar bill in 2011 that never made it out of committee. “The cost to taxpayers of these benefits is unsustainable and we simply cannot afford it. We cannot ask taxpayers to continue to foot the bill for public employee benefits that are far more generous than their own.”
Continue reading “Republican Senators Propose Eliminating New Feds’ Pensions”
June 6, 2013
“The ‘universe’ of programs and processes in need of reform at the Pentagon is more than large enough to allow for compliance with so-called sequestration while maintaining the strongest and most capable military the world has ever known.” – R Street Institute and National Taxpayers Union, June 2013
We couldn’t agree more. This quote, from a report released Tuesday by the fiscally conservative organizations R Street Institute and National Taxpayers Union, reflects a growing consensus that we can no longer afford to overlook waste at the Pentagon. Defending America, Defending Taxpayers details 100 specific recommendations for cuts to the Department of Defense (DoD)—the nation’s largest agency—totaling over $1.8 trillion, and makes a compelling argument for why these cuts will make our defense budget leaner while keeping us safe. Continue reading “Conservative Report Finds $1.8 Trillion in Pentagon Savings”