President Joe Bidenon of Washington Nearly 3 million people who earn pensions from their time as teachers, firefighters, police officers, and other public service workers will be impacted by a proposal that Sunday intends to sign into law that increases Social Security payouts for present and former public employees.
The Social Security Fairness Act, according to supporters, will address a long-standing inequity, but it will also put pressure on the Social Security Trust Funds, which are in danger of going bankrupt.
Two elements of the bill—the Windfall Elimination Provision and the Government Pension Offset—that restrict Social Security benefits for recipients who receive retirement benefits from other sources, such as state or local government public retirement programs, are repealed.
According to the Congressional Research Service, 745,679 people, or almost 1% of all Social Security recipients, had their payments lowered by the Government Pension Offset as of December 2023. The Windfall Elimination Provision affected over 2.1 million persons, or roughly 3% of all beneficiaries.
Eliminating the Windfall Elimination Provision would increase monthly payments to the impacted recipients by an average of $360 by December 2025, according to a September estimate from the Congressional Budget Office. According to the CBO, ending the Government Pension Offset would result in an average $700 increase in monthly payments for 380,000 recipients receiving benefits based on living spouses in December 2025. The average increase for 390,000 or surviving spouses receiving widower or widower benefits would be $1,190.
With Social Security’s regular cost-of-living adjustments, such sums would rise over time.
The Social Security Administration would owe back-dated payments because the change would affect benefits made starting in January 2024 and beyond.According to the legislation passed by Congress, the Social Security commissioner will modify primary insurance amounts as needed to reflect changes in the law. It’s unclear right now how this will occur or if those impacted will need to take any action.
Firefighters nationwide are thrilled to see the change, as we’ve corrected a 40-year injustice, according to Edward Kelly, president of the International Association of Fire Fighters. For surviving spouses of firemen who paid their own quotas into Social Security but were harmed by the government pension system, Kelly claimed the scheme was even more egregious.
Not counting the hundreds of thousands of pensioners who will gain from the reform, the IAFF has about 320,000 members.
According to Kelly, firefighters who receive pitiful wages can now afford to retire.
After years of advocating for the concept as a senator from Ohio, Sherrod Brown lost his reelection effort in November. The American Federation of State, County and Municipal Employees’ president, Lee Saunders, praised Brown’s advocacy.
According to a statement from Saunders, more than two million public servants will at last be able to obtain the Social Security payments they have been contributing to throughout their employment. After a lifetime of devotion, many will finally be able to enjoy retirement.
“The law is a historic victory that will improve the lives of educators, first responders, postal workers, and others who dedicate their lives to public service in their communities,” said Becky Pringle, president of the National Education Association.
Additionally, some Republicans voted against the proposal, including Sens. Thom Tillis of North Carolina, Rand Paul of Kentucky, and John Thune of South Dakota, while others, like Sen. Susan Collins of Maine, backed it. Last month, Tillis told The Associated Press, “Instead of doing this on a sustainable basis, we gave in to the pressure of the moment.”
However, the bill’s Republican backers argued it was a unique chance to fix what they called an unjust part of federal law that harms retirees from public service.
One of the main points of dispute in the 2024 election was the future of Social Security, which has emerged as a major political issue. Social Security benefits are received by approximately 72.5 million people, including children, retirees, and those with disabilities.
The Social Security Administration is already operating at its lowest staffing level in decades, and the new law’s policy revisions will add to its administrative burden. Despite serving more individuals than ever before, the agency currently employs 56,645 people, the fewest in more than 50 years, and is currently on a recruiting freeze.
Last May, the annual Social Security and Medicare trustees report stated that starting in 2035, the program’s trust fund will not be able to provide full benefits. The program’s bankruptcy date will be accelerated by around six months due to the new law. ___
This report was written by Stephen Groves of the Associated Press.
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