Breaking Pension Promises to Fund Transportation Bill is Wrong
Washington, D.C. –The leader of the National Treasury Employees Union (NTEU) said today she is appalled that the House Republican leadership would break pension promises made to federal workers years ago to fund a transportation bill.
The House Oversight and Government Reform Committee yesterday voted to increase pension contributions of federal employees, eliminate a supplement promised to workers with decades of service and change the way pensions are calculated for new employees, decreasing the value of federal pensions by nearly 40 percent.What is particularly egregious, said NTEU President Colleen M. Kelley, is that bill sponsors rationalized cutting the pay and retirement of middle-class federal workers, saying such moves were necessary to reduce the deficit. “This most recent action removes the pretense of deficit reduction and is clearly a gratuitous attack on the public servants who protect our borders, safeguard our air and food supply and look after our life savings.”
She was reacting to yesterday’s approval by the House committee of H.R. 3813, a measure that would increase pension contributions for federal workers and slash their pensions, and plans by House Republican leaders to use the savings to offset costs for a transportation bill.
“Why look to highway trust funds and gas taxes to fix crumbling roads and bridges when you can find the funding by reneging on federal pension commitments and cut federal pay?” the NTEU leaders said.
H.R. 3813 was introduced by Rep. Dennis Ross (R-Fla.); among other steps, it would require all federal employees to pay an additional 1.5 percent toward their retirement, a move President Kelley described as “a steep pay cut.”
Such a change would increase the contribution of a federal worker earning $50,000 a year from $400 annually to $1,150, and for a potentially much smaller pension, Kelley said.
“I find it outrageous that the Oversight Committee would seek to impose this regressive legislation on federal employees who already are contributing $60 billion to deficit reduction through the current two-year pay freeze,” Kelley said. “It is especially discouraging when you consider that the House simply refuses to address the pressing need for shared sacrifice, particularly from the wealthiest Americans.” She further noted that the pension cut provisions in the Ross bill are also included in H.R. 3630 to offset a payroll tax cut extension.
Kelley added: “How many other spending increases and tax cuts will the Republican leadership call on federal employees to bear the full cost of? I guess the Republicans’ idea of shared sacrifice is that they have lots of ways to share the money they take away from the only group actually sacrificing —middle class federal workers.”
In a news briefing earlier this week, the NTEU leader stressed the need for shared sacrifice and said NTEU will continue to oppose efforts aimed at further cuts in federal pay or retirement programs while there are no other groups contributing to deficit reduction.
She was especially critical of the Ross legislation for its provision eliminating, at the end of this year, the Social Security supplement of the Federal Employees Retirement System (FERS), a payment that accounts for about one-third of the value of the pension for those who meet age and service requirements to retire before age 62.
Kelley called it “unconscionable” to consider eliminating the Social Security supplement when so many federal employees have based their retirement plans on receiving it—as promised by Congress when they joined the federal workforce.
Two NTEU members, both long-time employees of the Internal Revenue Service, told the press briefing of the impact of such a development on them.
One said she would have to rethink her retirement plans, which are based in large part on spending more time with her husband, a retired federal employee himself, who is in poor health. Loss of the FERS supplement, she said, would make that virtually impossible.
The other told his story and said he considers payment of the supplement to be a promise made by Congress in exchange for his career commitment to federal service. “A promise made is a promise that should be kept,” he told the press.
source: National Treasury Employees Union