Ask the Advisor: January 2022

Why Is There No Action To Repeal the Windfall Elimination Provision?

Q: Why is there NO action to repeal the Windfall Elimination Provision forced upon federal retirees?  This has cost me something in excess of $36,000 (in Social Security benefits) since my retirement in 2009 under the Civil Service Retirement System.  The Government is shortchanging those who have paid into Social Security and we are denied the full amount of the Social Security benefits that we are entitled to.  C.B., Portland, OR.  

A:  In recent months, TSCL has been inundated with email from our grass roots supporters on a number of key Social Security issues including questions about the status of legislation that would end the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).  These provisions reduce the earned Social Security benefits of federal employees and other public sector workers, such as police, fire fighters and teachers.

According to the Congressional Research Service, a worker’s employment or self-employment is considered covered by Social Security if the services performed in that job result in earnings that are taxable and creditable for program purposes.  However, the WEP is a modified benefit formula that reduces the Social Security benefits of certain retired or disabled workers who are also entitled to pension benefits based on earnings from jobs that were not covered by Social Security and thus not subject to the Social Security payroll tax.

Does that sound fair?

In December 2020, about 1.9 million people (or about 3% of all Social Security beneficiaries) were affected by the WEP. Those workers mainly include state and local government employees covered by alternative staff-retirement systems as well as most permanent civilian federal employees hired before January 1, 1984, who are covered by the Civil Service Retirement System (CSRS).

The Government Pension Offset reduces Social Security survivors’ benefits for spouses, widows and widowers who also receive government pensions of their own.  As of December 2020, about 716,662 Social Security beneficiaries had spousal or widow(er)s benefits reduced.

TSCL supports several bills that would repeal these two provisions, including the “Social Security Fairness Act of 2021” which was introduced by Representative Rodney Davis (R-IL) and Representative Abigail Spanberger (D-VA) and has 231 cosponsors in the House.  But despite the bipartisan support in the House, enacting the legislation is still tricky.  Social Security legislation that affects program funding requires Congress to use special rules, and sixty votes would be needed in the divided Senate for passage.

“Repealing these provisions that unfairly penalize public employees would provide more certainty to retirees and it’s the fair thing to do,” says TSCL Executive Director, Shannon Benton.  “We urge Members of both sides to work together on a compromise bill that provides the benefits these retirees earned and paid for.”