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Legislation & Politics | ||
AFSCME Urges Social Security FairnessThis was sent as two separate letters to the full House and full Senate. April 12, 2007 Dear Senator/Representative: On behalf of the 1.4 million members of The American Federation of State, County and Municipal Employees (AFSCME), I urge you to cosponsor S.206/H.R.82, the Social Security Fairness Act of 2007, to repeal the unfair federal pension provisions that reduce Social Security benefits for hundreds of thousands of retired public employees. The Government Pension Offset (GPO) applies to nearly everyone receiving a public pension from work not covered by Social Security - approximately 25 percent of state and local government employees. Under the GPO, if the public pensioner is eligible for a spouse’s or widow’s Social Security benefit, the law requires that the benefits be offset by an amount equal to two-thirds of a retiree’s public pension. Approximately 335,000 retired federal, state and local government employees have already been affected by the GPO. For the great majority, the GPO totally eliminates the Social Security spousal/widow benefit. Currently, the average pension for many affected retirees is less than $500 a month. These very modest pensions are especially common for lower-paying occupational positions, such as school district employees. Our members in these positions include school cafeteria workers, crossing guards, bus drivers and custodians. When the GPO was first enacted, it was intended to target retirees receiving multiple government pensions, some of whom had higher incomes in retirement than they had while working. Retirees receiving a pension of less than $500 a month do not fit the image of the so-called "double and triple dippers” that Congress had in mind when the GPO was passed. The Windfall Elimination Provision (WEP) applies to individuals who receive a pension from a public service job not covered by Social Security. If the public pensioner also worked in a Social Security-covered job for at least 10 years, the WEP creates a public pension offset that can greatly reduce that person’s Social Security benefit payments. Approximately 635,000 retired federal, state and local government employees are currently affected by the WEP. That number grows by about 60,000 retirees each year. Under the WEP, part of a retiree's public pension (from non-covered employment) is considered equivalent to a Social Security benefit. And, Social Security won't let retirees collect two full benefits. So, instead of Social Security's normal benefit formula, which is weighted in favor of lower-wage workers, WEP retirees' benefits are calculated using a modified benefit formula for higher-wage earners. When the WEP was created in 1983 by Congress, the purpose of the legislation was to distinguish between two types of retirees - those who receive good pensions from primary jobs in non-covered employment, but whose low wages or short work records from secondary jobs make them appear to have had low-wage careers, and others who actually spent their entire work lives in low-wage jobs. Congressional supporters of WEP believed that those with secondary jobs were getting an unfair advantage from a Social Security benefit formula designed to give low-wage workers a decent income upon retirement. However, the Social Security Administration does not determine what public employees have earned in total wages but treats retirees as high-wage earners under WEP, thus unfairly penalizing these public pensioners. These unfair offsets impose an extreme hardship on public pensioners and their spouses who paid thousands of dollars into Social Security over 15, 20, even 30 years, but cannot receive the full benefits they would be entitled to, simply because they are also receiving a public pension. I ask for your support for S.206/H.R.82 that would restore retirement fairness for hard working public employees and retirees. Sincerely, |
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