Government plans - federal |
Federal Employees Will Gain Roth Investment Option This Spring
Proposed rules set for publication on Wednesday lay the groundwork for a major change in the investment choices available to federal employees through the Thrift Savings Plan with the addition of a Roth alternative. (The Washington Post)
Oversight Committee Advances Major Federal Pension Reform
"The House Oversight and Government Reform Committee advanced . . . the largest cost-saving reform to federal employee pensions since the creation of the Federal Employee Retirement System in 1984. H.R. 3813, the Secure Annuities for Federal Employee Act, introduced by Oversight Subcommittee on Federal Workforce Chairman Dennis Ross, R-Fla., was approved by a vote of 22-16." (House Committee on Oversight and Government Reform)
[Guidance Overview] IRS Addresses Effect of Indian Health Services Eligibility on HSA Eligibility
"This Notice finally answers an HSA eligibility question that was especially troubling because, as with certain veterans benefits, the right to obtain medical services from an IHS facility is determined by status (e.g., membership in a federally recognized Indian tribe), and not by choice. The IRS approach resembles the one used to determine HSA eligibility for those eligible for VA medical benefits -- a solution that some of us anticipated as the best fit." (Thomson Reuters/EBIA)
House Panel to Consider Pension Contribution Hike for Federal Employees
"Federal employees, including members of Congress, would contribute 1.5% more toward their pensions under legislation to be considered . . . by the House Oversight and Government Reform Committee." (Pensions & Investments; free registration required)
GAO Report on Federal Employees' Compensation Act: Benefits for Retirement-Age Beneficiaries
"[GAO] examined (1) the characteristics and associated compensation costs of long-term, full-time FECA beneficiaries, for USPS and non-USPS employees; (2) how wage compensation benefits for retirement-age, long-term, full-time FECA beneficiaries compare with federal retirees' annuities (not including USPS employees); and (3) the experiences of states that limit state workers' compensation benefits for workers at retirement age." (U.S. Government Accountability Office)
IRS Issues Updated Version of Taxable Fringe Benefit Guide for Governmental Employers
"The IRS has updated its Taxable Fringe Benefit Guide for federal, state, and local government employers. The Guide was created to provide those entities with a basic understanding of the federal tax and reporting rules on a wide variety of fringe benefit topics, and was last updated in 2008." (Thomson Reuters/EBIA)
[Guidance Overview] Indian Health Service Eligibility Not HSA Deal Breaker
"The IRS [said] that generally individuals are not eligible to establish an HSA if they do receive IHS services during the three months before the date on which they seek to establish the HSA. But that is not a blanket prohibition -- the IRS said that individuals who receive service through the HIS that is permitted under Notice 2004-2 still can establish an HSA." (Thompson Publishing Group)
[Opinion] Where the CBO Report on Federal Pay Went Wrong
"[The federal] employees that the report claims may be overcompensated are hardly those whom people would think of as 'government bureaucrats in Washington.' No, these 'bureaucrats' are among the lowest-paid federal employees, doing unglamorous but critical work around the country." (Washington Post)
Some Top Military Brass Making More in Pension Than Pay
"Previously, the maximum annual pension was based on an officer's pay at 26 years of service. Now, a four-star officer retiring in 2011 with 38 years' experience would get a yearly pension of about $219,600, a jump of $84,000, or 63% beyond what was once allowed." (USATODAY.com)
[Official Guidance] Text of IRS Notice of Hearing on Discussion Draft of IRS Regs on 'Indian Tribal Government Plan' Status
Reschedules a public hearing from June 5 to be July 10, and extends the period for the submission of public comments. (U.S. Internal Revenue Service)
[Official Guidance] Text of IRS Notice of Hearing on Discussion Draft of IRS Regs on 'Governmental Plan' Status
Reschedules a public hearing from June 5 to be July 9, and extends the period for the submission of public comments. (U.S. Internal Revenue Service)
Retirement Benefits, Pay, Duties, And Attrition of United States Capitol Police, Compared to Other Federal Police Forces
"USCP generally has enhanced retirement benefits, a higher minimum starting salary, and a wider variety of protective duties than other federal police forces in the DC metro area that GAO reviewed . . . . In 2010, the USCP Labor Committee presented six proposals that would enhance the current USCP benefit structure. GAO's analysis shows that five of the six would increase existing costs . . . ." (U.S. Government Accountability Office)
Retired Federal Workers Wait for System Fix
"for the retirees who wait many months to get a full annuity, 'unacceptable' might be too mild. And Congress is increasingly anxious to see real improvement, not just plans to make things better, in a retirement program that does not treat federal employees with the respect they deserve." (Washington Post)
[Official Guidance] IRS Notice 2012-14: 'Eligible Individual' HSA Status for Persons Eligible for Services at an Indian Health Service Facility (PDF)
"An individual who is eligible to receive medical services at an IHS facility, but who has not actually received such services during the previous three months, is an eligible individual within the meaning of ? 223(c)(1) who may establish and make tax-free contributions to an HSA. However, an individual generally is not an eligible individual if the individual has received medical services at an IHS facility at any time during the previous three months." (U.S. Internal Revenue Service)
Public-private Pay Gap Varies Greatly By Education Level
"Federal civilian workers with only a high school diploma or less fared much better than private sector employees with the same: They earned 21 percent more wages, 72 percent higher benefits and 36 percent more in total compensation. . . . In contrast, among employees with a professional degree or doctorate, federal workers earned 23 percent less in wages and 18 percent lower total compensation, while receiving about the same benefits as the private sector employees with identical degrees." (GovExec.com)
How Does the Compensation of Federal Employees Compare with That of Workers in the Private Sector?
CBO Director's Blog. 'The federal government employs 2.3 million civilian workers, or 1.7 percent of the U.S. workforce, in over 700 occupations and spent about $200 billion in fiscal year 2011 to compensate them." (U.S. Congressional Budget Office)
Comparing Benefits and Total Compensation in the Federal Government and the Private Sector (PDF)
"This analysis integrated Current Population Survey data from 2005 through 2010 with data on a wide range of employee benefits to compare the cost of those benefits for federal employees and for workers in the private sector who have certain similar observable characteristics." (U.S. Congressional Budget Office)
Comparing Wages in the Federal Government and the Private Sector (PDF)
"This analysis used Current Population Survey data from 2005 through 2010 to compare the hourly wages of federal employees and workers in the private sector who have certain similar observable characteristics." (U.S. Congressional Budget Office)
Comparing the Compensation of Federal and Private-Sector Employees
"Employees of the federal government and the private sector differ in ways that can affect compensation. Federal workers tend to be older, more educated, and more concentrated in professional occupations than private-sector workers." (U.S. Congressional Budget Office)
Lawmakers Wary of Military Retirement Commission Plan
"The DOD proposal calls for authority similar to what has been provided to past base closure and realignment commissions, so that Congress could only give an up-or-down vote on the commission's final recommendations, with no ability to make any changes." (Gannett Government Media Corporation)
House Panel Debates Cuts to Federal Retirement Benefits
"Proposals to cut a defined pension plan under the Federal Employees Retirement System drew the ire of congressional Democrats and labor union groups, while suggested reductions to lawmaker benefits were more warmly received at a House Oversight and Government Reform Subcommittee on the federal workforce Wednesday." (Government Executive)
Federal Retirement Thrift Investment Board to Publish Details About Addition of Roth 401(k) Option to Thrift Savings Plan
"The new Roth TSP component will invest an employee's after-tax earnings and cannot be taxed when withdrawn, similar to a traditional Roth IRA. There will be no income limits on earnings from TSP's Roth option as there are on a traditional Roth IRA, which could make the feature more attractive to federal workers and service members." (Government Executive)
GAO Report on U.S. Capitol Police: Retirement Benefits, Pay, Duties, and Attrition Compared to Other Federal Police Forces (PDF)
"GAO (1) compared USCP to other forces with respect to retirement benefits, minimum entry-level salary, duties, and employment requirements; (2) compared attrition at USCP to other forces, and determined how, if at all, USCP and other forces used human capital flexibilities (e.g., retention bonus); and (3) determined what level of retirement income USCP benefits provide and the costs associated with the proposed benefit enhancements." (U.S. Government Accountability Office)
Budget Puts Military Pension Plan in Cross Hairs
"Right now, the system's 20-year vesting rule means many members of the military walk away with nothing, while those who put in 20 years or more can retire with at least half their salary and other lifetime benefits. In 2010, those payments cost the Department of Defense $50 billion. By 2034, it could balloon to $108 billion . . . ." (Pensions & Investments)
Federal Retirees Face Confusion, Possibly Payment Delay
"'With OPM's current backlog and the expected significant rise in retirement processing workload, the time frame for OPM to place an annuitant in interim pay may increase to 6-8 weeks after their retirement date,' according to the Army." (The Washington Post; free registration required)
Federal Thrift Savings Plan Administrative Expenses Stay Steady
"Net administrative expenses charged to each participating federal employee's Thrift Savings Plan account were about 20 cents per $1,000 of investment in 2011, roughly the same as the figure for 2010, TSP officials said Monday." (Government Executive)
Federal Pay And Benefits Remain at Risk As Congress Returns
"House and Senate conferees are scheduled to begin discussions soon over how to finance a 12-month payroll tax cut extension past February, and those talks likely will include proposals to prolong the federal pay freeze and reduce the retirement benefits of government employees and lawmakers." (GovExec.com)
Congress's Six-Figure Benefits Add to $674 Billion Pension Gap
"The federal retirement system has emerged as a cost-cutting target as the government faces a budget deficit exceeding $1 trillion. A 2010 Congressional Research Service study reported that U.S. government pension programs had a shortfall of $674.2 billion, mostly due to insufficient funding for workers hired before 1984." (Bloomberg L.P.)
Treasury's Thrift Savings Plan Maneuver Aims to Keep Government under Debt Cap
"The federal government resorted to a favorite accounting maneuver Tuesday to stay under its debt limit, suspending the issuance of securities in a retirement savings program for federal and postal employees." (The Washington Post; free registration required)
Federal Agencies Tighten Belts with Buyouts and Early Retirements
"OPM uses two tools to help agencies reduce their staffing levels without resorting to pink slips and firings. One is the Voluntary Separation Incentive Payments (VSIP) program, which is government-speak for buyouts. Employees can get up to $25,000 to quit. The other is the Voluntary Early Retirement Authority (VERA), which allows workers to get annuities years earlier than usual." (The Washington Post; free registration required)
Are Federal Buyout Incentives Worth Taking?
"For workers who are not planning an imminent retirement already and for those enrolled in the Federal Employees Retirement System -- which is the bulk of the government workforce -- taking a buyout can mean losing more money over time." (Government Executive)
House Plays the Anti-Santa to Federal Workers
"The legislation would offset a one-year continuation of the payroll tax holiday in part by adding 12 months to the two-year freeze on federal employees' base pay. Employees also would have to pay more toward their retirement under the measure, which the House passed largely along party lines, with Republicans wearing the Grinch suits." (The Washington Post; free registration required)
USPS Hopes for Another Deferral on Mandatory Payment to Prefund Retirees' Health Benefits
"The Senate Homeland Security and Governmental Affairs Committee last month approved postal reform legislation that included language to restructure prefunded retirement health benefits, reducing the payment goal to 80 percent, and to require USPS to negotiate with its unions to develop a new employee health care plan." (National Journal Group, Inc.)
GAO Report: Federal Employees' Group Life Insurance: Retirement Benefit and Retained Asset Account Disclosures Could Be Improved
"GAO recommends that OPM (1) improve disclosures on important FEGLI features, (2) develop and implement a more structured process for reviewing the FEGLI program and premium rates, and document review outcomes, and (3) improve disclosures on RAA protections and regulation." (U.S. Government Accountability Office)
[Opinion] Government Workers Underreport Retirement Plan Availability in the Current Population Survey
"[I]f a substantial portion of relatively well-educated government workers do not know that their government employer offers a retirement plan to any of its workers, how can we expect the private sector workforce to be more accurate in their response to the question?" (Profit Sharing/401(k) Council of America)
[Opinion] Pension Should Be a Personal, Not Government, Responsibility
"If . . . the federal government wants to keeps its hands in retirement planning, then it should also look at other, nontraditional funding options that restrain overall personnel costs within a lower total federal budget. For example, it can reset starting wages at a lower amount for new employees, similar to what is already happening in the private sector (think airlines and two-tier wage scales)." (Gannett Government Media Corporation)
Cutting Retiree Benefits a Sore Subject for Military
"Military retiree benefits cost the Pentagon $50 billion a year. . . . There are 1.9 million military retirees drawing pay and benefits, compared to 1.5 million in the active duty force. In 2010, then-Defense Secretary Robert Gates said those costs are 'eating the Defense Department alive.'" (NPR)
Federal Pension Payment Delays Get Much Worse
"The Office of Personnel Management's backlog of pending retirement claims has grown 58 percent since Director John Berry pledged more than a year ago to pay retirees their full pensions more quickly." (Gannett Government Media Corporation)
Cost-Effectiveness of Potential FEHBP Reforms Questioned
"The Office of Personnel Management has attributed the smaller [premium] increase in part to its ability to leverage the program's nearly 8 million participants and is seeking to take that a step further with changes to FEHBP's prescription drug options. But some observers question whether that buying power brings federal workers the best value -- or even the best benefits." (Government Executive)
Main Streer Says to Congress: No More Privilege, Perks, Pensions
"[The group surveyed indicated] that they are also fed up to the hilt with Congress, particularly in the realm of the 'culture of privilege' that goes with the tendency of many to spend their entire careers in Washington. The group strongly favored term limits--2 terms for Senators (for a total of 12 years) and 4 terms for Congressmen (for a total of 8 years)." (Clarity Digital Group LLC d/b/a Examiner.com)
Inside The Corporate Plan to Occupy The Pentagon
"[T]he push for pension cuts and other corporate 'reforms' at the Pentagon originates from an obscure advisory panel that has existed for a decade: the Defense Business Board. Its 21 members know little about military affairs, but they are rich in Wall Street experience, including with some of the biggest companies implicated in the 2008 financial meltdown." (Mother Jones)
Thrift Savings Plan Gears Up to launch Roth Option
"Staff worked this summer and fall to install software for record-keeping of the tax options selected by participants. The next stage will allow participants to transfer funds in from other employers, and the third stage will allow them to transfer money out when they leave the plan." (Government Executive)
GAO Testimony: OPM Retirement Modernization: Longstanding Information Technology Management Weaknesses Need to Be Addressed
Given by the director, Information Management and Technology Resources Issues, before the House Committee on Oversight and Government Reform: Subcommittee on Federal Workforce, U.S. Postal Service and Labor Policy, November 15, 2011. 'In a series of reviews, GAO found that OPM's efforts to modernize its retirement system have been hindered by weaknesses in several important management disciplines that are essential to successful IT modernization efforts." (U.S. Government Accountability Office)
Public-Sector Pensions Are Protected in California Constitution
"[The U.S. Constitution states that] 'No state shall . . . pass any . . . law impairing the obligation of contracts . . . ' As widely interpreted -- most importantly by the courts (or so we laymen are told) -- the clause means that pensions promised state and local government workers on the day they were hired cannot be reduced [even with respect to the rate of future benefit accruals, potentially including an increase in required employee contributions] without giving them a new compensating benefit." (Los Angeles Times)
USPS Pension Payments Could Finance Early Retirement
"At least 100,000 employees of the U.S. Postal Service could be offered early retirement buyouts under a Senate plan that lets the agency take back $6.9 billion in pension overpayments to finance the incentives and to pay other debts that have pushed it to the brink of insolvency." (Pensions & Investments)
[Opinion] Dear Supercommittee: Main Street Says Look at Defense Contractor Pensions
"Stop reimbursing the costs of pensions and other retirement benefits at huge, and hugely profitable, defense contractors. Over 10 years, such a move could save an estimated $30 billion . . . ." (New York Times; free registration required)
USPS Pension Payments Could Finance Early Retirements
"At least 100,000 employees of the U.S. Postal Service could be offered early retirement buyouts under a Senate plan that lets the agency take back $6.9 billion in pension overpayments to finance the incentives and to pay other debts that have pushed it to the brink of insolvency." (Pensions & Investments; free registration required)
[Opinion] Supercommittee Should Look at Pensions
"Here's one idea: Stop reimbursing the costs of pensions and other retirement benefits at huge, and hugely profitable, defense contractors. Over 10 years, such a move could save an estimated $30 billion -- the amount by which these pensions are collectively underfunded." (The New York Times; free registration required)
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