Notch Bulletin - Notch Reform Has Strong Support In New Congress

Notch Bulletin – Notch Reform Has Strong Support In New Congress

Notch Reform continues to be an issue of major importance to seniors and their families.  In fact, over 100 co-sponsors of "The Notch Fairness Act" were re-elected to the new Congress.  TSCL is already meeting with new Members of Congress to educate them about the need for resolving the Notch inequity.

The "Notch" refers to a sudden decline and disparity in benefits that occurred when Congress enacted changes to the Social Security benefit formula in 1977.  The changes were abrupt, because a transitional benefit formula that Congress provided to phase in the changes failed to provide any benefit protection.  Persons who were born from 1917 through 1926, and who were the first to be affected by the 1977 law changes, receive lower benefits than other retirees, even though they have similar work and earnings records.

Notch Reform advocate Representative Ralph Hall (TX) has reintroduced "The Notch Fairness Act." "The Notch Fairness Act," would allow Notch Babies their choice of a higher benefit or a lump sum of $5,000 payable in four annual installments.  The legislation would allow eligible survivors of Notch Babies, persons who receive Social Security benefits based on the account of a Notch Baby, to receive up to 100% of the benefit payable to the deceased.

There is also strong support in the Senate.  New Senate Majority Leader, Senator Harry Reid (NV), is long-time Notch Reform advocate.  Senate Majority Leader Reid has co-sponsored "The Notch Fairness Act" in the past, saying "While we must save Social Security for the future, we have an obligation to those who, through no fault of their own, receive less than those who were fortunate enough to be born just days before or after the Notch period."

Congress cannot escape the Notch issue.  It is just one of a host of thorny problems that must be confronted under proposals to reform Social Security.  According to a recent report from the Government Accountability Office (GAO), many recent proposed modifications to the Social Security benefit formula could create "new notches." This confirms our warnings in recent years that Congress could "give birth to a new generation of Notch Babies" under coming Social Security reform.

It's up to all of us to make sure that doesn't happen, and to make sure, as Senate Majority Leader Reid has said, that Congress moves to "pay off our debt to the Notch Babies."  Notch Reform continues to be very high on TSCL's agenda, and we are working to ensure full and fair consideration.

January 2007