CNN
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After months of contending with the Trump administration’s multi-pronged effort to downsize the federal workforce, government employees are now facing the possibility of another major change that could push even more of them out the door.
House Republicans are looking to make several big adjustments to federal workers’ retirement benefits to help pay for the party’s sweeping tax and spending cuts package. The House Oversight Committee last week approved a plan that would squeeze $50 billion in savings out of the retirement system over the next decade.
“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,” Jacqueline Simon, policy director of the American Federation of Government Employees, the largest federal workers union, told reporters on Monday.
The cuts could lead workers eligible for retirement to head for the exits in an effort to lock in their current benefits, union leaders say.
Congressional Republicans have long wanted to overhaul federal staffers’ pension system, as did President Donald Trump during his first term. But their efforts typically did not advance far.
In the current political environment, however, the policy push may have a greater chance of succeeding.
Republicans’ “big, beautiful bill” has not yet been finalized and must still be approved by the full House and the Senate.
Rep. James Comer, the committee’s chair, described the effort as a way to save Americans money.
“The simple truth is that a significant amount of the costs associated with all of these benefits are funded by hardworking taxpayers in the private sector and increasingly now federal government borrowing,” Comer said in his opening remarks when the committee examined the plan.
At least one House Republican has already come out against the measure. Ohio Rep. Mike Turner joined Democrats in voting against the committee’s plan last week.
“I oppose any and all efforts to reduce federal spending by taking money from the hard-earned pensions of federal workers,” he said in a statement. “These pensions are not giveaways – they are promises to federal workers in exchange for their dedicated service.”
The most significant measure approved by the committee would raise the Federal Employees Retirement System contribution rate for many current civilian and postal employees to 4.4% of their salary. Those hired prior to 2014 generally contribute either 0.8% or 3.1%, while more recent hires typically already contribute 4.4%.
For new retirees who are too young to collect Social Security benefits, the plan would eliminate an additional payment that’s currently available to retired federal workers until they turn 62.
The plan would also base retirees’ pension payments on their average highest five earning years, instead of highest three years, which could reduce benefits by thousands of dollars annually.
Certain employees, including those in law enforcement, Customs and Border Protection officers and air traffic controllers, would not be subject to these provisions, though they would not be eligible for the additional pension payment until after their mandatory retirement age of 56 or 57, depending on their position.
Plus, the plan would impose an additional 5% pension contribution for new employees who don’t agree to serve “at will,” a status that would give them fewer job protections.
The proposed plan has sparked a fresh round of concerns among federal workers, particularly among older employees, union leaders say.
“People are very frustrated at the moment, thinking that it’s kind of like a bait and switch,” said Brandy Moore White, president of the AFGE’s Council of Prison Locals, which represents more than 30,000 correctional officers and staff at federal prisons.
Although her members are not subject to many of the provisions, those who retire before they turn 57 would not receive supplemental payments until they hit that mandatory retirement age. The loss would be “devastating” for a share of the prison workforce since it’s not uncommon for employees to retire in their 40s or early 50s after years of service.
At the Social Security Administration, a quarter of the staff are eligible for retirement, said Jessica LaPointe, president of AFGE’s Council 220, which represents workers in the agency’s centers, field offices and other units. Some are calling her to say they want to put in their retirement papers now so they can lock in their pension benefits.
“There’s no way that I would be able to absorb that hit,” she said her colleagues are telling her.
