Check out this article.
https://federalsoup.com/articles/2017/05/23/mulvaney-press-briefing.aspx?s=FD_240517
Time to speak up with our votes.
Any one who supports this budget needs to be on notice.
Social Security is only a portion of our FERS retirement.
And if they want us to provide for our retirement then they need to lift the IRS limits on how much we are allowed to save.
I am fairly certain no significant changes will be made to current/vested employees. At very worst, I could see a high 3 to high 5, and chained CPI for COLA's, and MAYBE a phased increase in employee contribution but that is doubtful. Newly hired employees...all bets are off. It would not surprise me if a new plan is implemented that strips the supplement (SRS), moves to a voucher system for retiree health care, and increases the employee contribution WITH the option to waive the defined benefit all together in favor a greater employer contribution to the TSP. Many local government agencies, are moving away from pensions in favor of 401(k) style retirement plans with much greater employer contributions (i.e. 5% match + 12% additional employer contribution). These plans allow the employer to "wash their hands" of the employee the day they separate. Most people don't realize how expensive it is maintain a pension plan, not to mention the HR costs to process and service retiree's.
With that said, could anyone imagine if a private cooperation tried to do something like this? There have been various pieces of legislation passed over the years to protect private sector employees against default and significant changes to pension plans. There is even a government agency charged with the oversight of private pensions (Pension Benefit Guarantee Corporation). The Pension Protection Act of 2006, Employee Retirement Income Security Act of 1974 (ERISA), and others seek to protect private sector employees. How can the same government, which is supposed to be the model employer, enact such changes under such an accelerated time table? Government employees entered in to a contract with their employer to secure these retirement benefits. What is the point of vesting? I just don't see it getting through for current employees, but it sends a clear message. It seems to be more of a scare tactic to chase people in to retirement and reduce the size of government.
Posted by: Gary <tweet_pa@yahoo.com>
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