S. 46: A Bill To Permit Military Service To Be Credited for Both Civil Service Retirement and Social Security Benefits

Comments were presented on S. 46, a bill to revise civil service retirement provisions regarding annuity credits for military service performed after l956. GAO is not in favor of S. 46, because it would allow former military personnel to receive both social security and civil service retirement credits for the same period of service. It would also increase the cost of the civil service retirement system. GAO has suggested an alternative to both the present law and the proposed legislation. Under this alternative, a civil service retiree with military service, if eligible for social security, would have the choice of receiving social security along with a recalculation of the civil service annuity, or waiving social security and continuing to receive the full civil service annuity. The alternative would protect a retiree's current income and, if social security would be more than the reduction in the civil service annuity, that choice would also be available. At the same time, military service would not earn benefits from both the civil service system and social security. GAO estimated that the alternative would increase civil service retirement costs by $4 billion and reduce social security benefits by $2.5 billion over the next 25 years. The net cost of the alternative would be $1.5 billion and, over the same period of time, the cost of S. 46 would be about $7.9 billion. The many Federal retirement plans have not been viewed as parts of an overall retirement system. As a result, each has developed in a piecemeal fashion and the programs vary substantially. The problems addressed by S. 46 would not have occurred if the retirement systems and social security were less independent and more compatible.