Proposed Revisions to the Civil Service Retirement System

Several bills are being considered which would make certain changes to the civil service retirement system. Concerns have been raised that benefits may be paid unnecessarily to many retirees. Legislation should be enacted to encourage retention of potentially productive employees, who are being retired on disability, by requiring agencies to retain such employees in vacant positions they are capable of performing. Many retirees receive benefits under guaranteed minimum provisions who, in fact, are not the short-term personnel that the law was intended to serve as they are also receiving benefits from prior careers in the military. Legislation to implement these recommendations has been introduced in the House. Similar action should be taken in the Senate, perhaps as an amendment to S. 2449. Currently, S. 2449 would (1) prohibit employees who are eligible for optional retirement from retiring on disability, (2) revise the test period for earning-capability restoration from 2 years to 1 year, and (3) allow the Office of Personnel Management limited access to social security earnings information so that income reported by disability annuitants can be confirmed. It should be recognized that the overall effect of S. 2449 on retirement costs may be negligible because the amount of benefit payments to retirees would not be affected. GAO fully supports S. 2450 which would amend the cost-of-living adjustment process for civil service retirees by repealing the provision of law which allows new retirees to benefit from increases in the Consumer Price Index. House bill 2583 would discontinue civil service benefit payments to an annuitant during periods of employment as a Federal justice or judge since Federal justices and judges are covered by the Federal judiciary retirement system. Both full salary and full retirememt benefits should not be paid to a Federal employee during active duty service. Therefore, H.R. 2583 would result in more consistent treatment of retirees under the civil service retirement system. Finally, S. 358 is intended to correct a perceived inequity in the retirement program for Secret Service personnel by allowing credit for prior service with the District of Columbia police, U.S. Park Police, or Executive Protective Service. GAO believes the proper course of action would be to remove Federal personnel from the District system, but does not oppose the enactment of S. 358.