Copyright 2000 The Washington Post
The Washington
Post
June 28, 2000, Wednesday, Final Edition
SECTION: METRO; Pg. B02; FEDERAL DIARY
LENGTH: 742 words
HEADLINE:
High-Impact Tale of 'Offset' Law's Effect on Low-Income Retirees
BYLINE: Stephen Barr
BODY:
Ruth Pickard, 73, of Palm Beach Gardens, Fla., started working when
she was 16. She labored in the private sector, left the work force to stay home
with her two children, then went back to work as a U.S. Postal Service employee.
After 46 years of private and government employment, she decided to
retire and applied for Social Security, claiming both earned and spousal
benefits. But she found that her retirement income was "drastically curtailed"
because of a confusing law known as the "government pension
offset." Today, Pickard receives monthly retirement income of $ 1,071
from the Civil Service Retirement System, but only $ 171 from Social Security,
much less than she had expected.
"I soon realized that I could not make
ends meet on my federal annuity and my small Social Security check, so 6 1/2
years ago, I went back to work part time. I am still working," she said.
Pickard told her story yesterday to the House Social Security
subcommittee, chaired by Rep. E. Clay Shaw Jr. (R-Fla.). Pickard, a member of
the National Association of Retired Federal Employees, lives in the
congressional district that Shaw represents.
Republicans and Democrats
expressed sympathy for Pickard's plight. She is one of about 305,000 people
receiving reduced spousal Social Security benefits because of the offset law. In
about three-quarters of those cases, the offset caused spousal benefits to be
completely withheld, the Congressional Budget Office said.
Despite the
substantial numbers affected, several subcommittee members signaled that they
were not prepared to repeal or revise the offset law immediately. Shaw noted
that Congress has few legislative days left this year and suggested that the
offset might receive more attention next year, when Congress seems more likely
to grapple with an overhaul of the Social Security system.
Still, the
hearing was one of the most extensive on the contentious topic in years. Joining
Pickard in condemning the offset law as unfair to federal, state and local
government employees were Rep. William J. Jefferson (D-La.), who has 244
co-sponsors for legislation to revise the offset law; Vincent R. Sombrotto,
president of the National Association of Letter Carriers; Frank G. Atwater,
president of NARFE; and John Keane, the administrator of the Jacksonville, Fla.,
Police and Fire Pension Fund.
The offset law, Jefferson said, "will
cause tens of thousands of retired government employees, including many
teachers, custodians or lunch-room workers, to live their retirement years at or
near the poverty level."
The offset was enacted in 1977 and applies to
people who:
* Receive pensions based on employment that was not
covered by Social Security--such as federal employees in the Civil Service
Retirement System.
* Receive Social Security benefits because
they are the spouse or survivor of a person who was entitled to Social Security.
The offset, in theory, affects government workers the way Social
Security's "dual entitlement" provision affects private-sector workers--only
less so. The dual entitlement provision requires that benefits payable to a
person as a spouse or surviving spouse be reduced by the amount of that person's
own Social Security benefit.
Under the offset, two-thirds of a CSRS
pension is treated as though it were a Social Security benefit, and benefits are
reduced by that amount.
Social Security Deputy Commissioner Jane Ross
offered the case of a woman with an earned Social Security benefit of $ 600 and
a spousal benefit of $ 700, for a total of $ 1,300 a month. Under the dual
entitlement provision, she ends up with $ 700 in earned and spousal benefits.
Under the offset law, a woman with a government pension of $ 600 and a
spousal Social Security benefit of $ 700 receives $ 900 a month.
The
offset, Ross suggested, removes "an unfair advantage available to government
workers" who retired under CSRS. (Federal workers under the newer Federal
Employees Retirement System participate in Social Security, so offset is not an
issue for them.)
Ross's rationale did not sway critics of the offset.
"If you pay the money in, you ought to be able to get it out," Keane said.
"We're not trying to get anything that we didn't pay for."
Online Today
Join me for an online discussion of federal
employee and retiree issues at noon today on www.washingtonpost.com.
Stephen Barr's e-mail address is barrs@washpost.com.
LOAD-DATE: June 28, 2000