US senators slam pension cuts as ‘draconian’

By on 22/06/2018
Trump’s administration is planning cuts to civil service benefits

Twenty-six senators have urged Office of Personnel Management director Jeff Pon to reverse his proposals to slash retirement benefits for current and future federal retirees.

Pon proposed the changes to Congress in May. If implemented, they would increase the contributions employees make to the Federal Employee Retirement System (FERS); eliminate the FERS supplement for employees who retire from 2018; build retirement calculations around the average of the highest five years of salary, instead of three; and reduce or eliminate cost-of-living adjustments.

The loss of the FERS supplement would particularly affect employees who have to retire early due to the physical demands of the job, including firefighters and customs border protection officers, the senators pointed out in a letter.

“These proposals affect employees who have dedicated decades of service to the federal government,” the letter states.

One front in the battle

Pon’s proposals form part of a series of reviews to civil service working terms and conditions by the Trump administration. He has justified them as a means of bringing the federal retirement system more in line with the private sector, while making it easier for employees to transition between federal and private sector employment.

Trump’s budget proposals state that federal employees earn higher combined pay and benefits than employees in the private sector. However, the senators said this was a “gross oversimplification” of the findings of the 2017 Congressional Budget Office Report.

The report actually concluded that total compensation costs for workers with a degree or doctorate were 18% lower than those for similar private-sector employees, the senators noted.

“To further increase this differential would hamper our ability to hire experts in mission-critical areas,” the letter states.

Recruitment warning

“We fear that these cuts are motivated by an ongoing effort to balance the budget on the backs of federal workers rather than an effort to provide a comprehensive approach to modernizing federal employee compensation,” it adds.

The senators also fear that the reforms would be “devastating” to recruitment and retention of civil servants. One third of permanent career federal employees are due to retire next year, while 17% are below the age of 35, according to the senators.

“As you continue to develop legislative proposals related to the compensation of federal employees, we urge you to move past draconian cuts that harm the financial security of federal employees in every state across the country, and instead commit to comprehensive reforms that modernize our government’s compensation system in a way that encourages the best and brightest talent to join the ranks of our dedicated civil servants,” they wrote.

About Catherine Early

Catherine Early is a journalist and editor specialising in government policy and regulation. She writes predominantly about environmental issues and has worked for the Environmentalist, the ENDS Report, Planning magazine and Windpower Monthly, and also written for the Guardian, the Ecologist and China Dialogue.

One Comment

  1. cindy andersen

    22/06/2018 at

    Money is deducted from my federal paycheck for my FERS retirement; I assume that money is invested in an annuity so it’s available to me when I retire. Does that investment not keep pace with inflation, allowing for COLA’s? If not, I get it would be a drain on the federal system to pay retirees more money that they don’t have. But if so, why would the government have any right to skim that interest money off the top?

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