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S. 677, the Civil Service Retirement Cost-of-Living Adjustment Act of 1981

Published: Apr 01, 1981. Publicly Released: Apr 01, 1981.
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Highlights

Under present law, all civil service annuities are adjusted semiannually by the full percentage increase in the Consumer Price Index. Under S. 677, retirees and survivors age 65 and over would continue to receive full, semiannual adjustments; however, those retirees and survivors under age 65 would receive adjustments only once a year. GAO believes that the proposed legislation would reduce the retirement system's costs considerably. GAO believes, however, that retaining semiannual annuity adjustments for disability retirees is inconsistent with the recently enacted annual adjustment process for Federal employees with job-related disabilities. GAO also believes that, while further study may be needed to assess the impact of applying similar changes to the military retirement system, limiting such a major policy change only to civilian retirees is inappropriate. GAO believes that full, once-a-year adjustments to all Federal retirement programs would be preferable because: (1) all retirees and survivors would be treated equally; (2) the adjustment provisions would be consistent with both the Federal workers' compensation and social security programs; and (3) the provisions would be more consistent with prevailing non-Federal practices.

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