A CPI for Retirees Is Not Needed Now but Could Be in the Future
GGD-82-41
Published: Jun 01, 1982. Publicly Released: Jun 01, 1982.
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Highlights
GAO reviewed the need for a retirees' Consumer Price Index (CPI) to aid Congress and others in deliberations regarding possible actions to maintain the financial stability of retirement programs.
Recommendations
Matter for Congressional Consideration
| Matter | Status | Comments |
|---|---|---|
| Congress should enact legislation requiring that CPI-U be used instead of CPI-W to compute the cost-of-living adjustments for federally administered retirement programs. Any such legislation should be enacted in time to coincide with the BLS decision to revise the homeownership component of CPI-U starting in January 1983. | With the decline in inflation CPI-W, CPI-U, and weighting differences, it may no longer be significant enough to warrant further action. |
Recommendations for Executive Action
| Agency Affected | Recommendation | Status |
|---|---|---|
| Department of Labor | The Secretary of Labor should direct BLS to compute a retirees' index using that revised measure of homeownership costs and to recompute that index periodically thereafter, but at least annually, once the methodology for computing homeownership costs has been revised in the index used to escalate retirement programs. To compute that index, BLS should apply retiree expenditure weights to the price information already being collected in support of CPI-U. |
With the decline in inflation CPI-W, CPI-U, and weighting differences, it may no longer be significant enough to warrant further action.
|
| Office of Management and Budget | OMB should, once BLS starts computing a retirees' index: (1) monitor the relationship of that index to the index being used to calculate cost-of-living adjustments for federally administered retirement programs; and (2) determine, with input from the Social Security Administration and other agencies responsible for administering those programs, whether differences between the indexes are significant enough to warrant proposing changes to the mechanism for computing cost-of-living adjustments. |
With the decline in inflation CPI-W, CPI-U, and weighting differences, it may no longer be significant enough to warrant further action.
|
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Topics
BudgetingCivil service pensionsCost of livingRetireesInflationMonitoringRetirement benefitsSocial security benefitsVeterans benefitsMortgage market