Congress targets fed workers' pensions for savings
WASHINGTON — Top lawmakers have found easy prey in their hunt for savings for Congress' budget deal: Federal workers' retirement programs, which are notably generous compared to the norm in private industry.
Most federal civilian employees hired beginning in January will contribute 4.4 percent of their pay to their pension plans under the bipartisan budget agreement. Current government workers' rates will remain unchanged: Those hired in 2013 will continue paying 3.1 percent, while most on the payroll before then will keep contributing 0.8 percent.
The workers say they've been singled out for a painful hit in the measure, which the House approved on Thursday and the Senate is expected to complete this week.
Rep. Chris Van Hollen, D-Md., the ranking member of the House Budget Committee, said he signed off on the $6 billion increase for new federal employees hired beginning in January because President Obama assured him he would propose no new retirement benefit cuts in next year's budget.
“These are working class people,” said Jackie Simon, policy director for the American Federation for Government Employees, citing Border Patrol agents and nursing assistants at Veterans Affairs hospitals. “These are not people who can afford it.”
At a time when pensions for private industry workers are edging toward extinction, some said diminished retirement programs are a sign of the times.
While 38 percent of private industry workers received pensions in 1979, just 14 percent did in 2011, the most recent figures from the Employee Benefit Research Institute, which advocates for employee benefit programs.
Besides having pensions, most federal workers can put money into a 401(k)-like retirement savings program, the Thrift Savings Plan, to which the government makes matching contributions.
That combination is far better than what's available to most private industry workers. There, only 11 percent of employees had both savings plans and monthly pension payments to look forward to in retirement, according to the research institute's 2011 figures.
In the federal workers' savings program, the government matches up to the first 5 percent of employees' contributions.
Only about 4 in 10 companies offer retirement savings plans. In the most common, employers match half the money workers contribute up to the first 6 percent of pay, according to an industry survey.
Show commenting policy
TribLive commenting policy
- Feds weighed national standards but let North Dakota set regulations for oil trains’ safety
- Young white males replace older black men as OD victims as heroin deaths climb
- Latest winter blast strands airline passengers, motorists
- Reports: Actor Ford seriously injured in small-plane crash in L.A.
- Weapon supply vulnerable to hackers, Pentagon official warns
- McConnell punts on Iran review bill
- Gag order overturned in Upper Big Branch case
- Dig uncovers ancient stone tool in eastern Oregon
- Appeals court tosses gag order in ex-coal company CEO’s case
- Lawmakers move to require schools to teach cursive amid Common Core wrangling
- Raw milk has little evidence of antibiotics, FDA survey finds