Changes are made to federal benefit cuts as the House last week narrowly passed, on a vote of 215-214-1, the massive reconciliation bill enacting much of President Trump’s agenda.
Federal employees were spared over $30 billion from an original $50 billion cut target Not included in the updated legislation was a proposal to raise the Federal Employees Retirement System (FERS) contribution rate to a mandatory 4.4 percent for all federal employees.
And changes for annuity calculation from High-3 to High-5 were dropped entirely following advocacy before the House vote by House Oversight Committee Democrats and some Republicans. Previously the implementation date had been kicked back one year to 2028.
Other federal benefit cuts remain in the legislation, although some of the dates were changed.
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The elimination of the FERS annuity supplements for those who have not yet reached the age of 62 to collect Social Security, was delayed until 2028.
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There were also additional exceptions created to receive the FERS supplements, including for those who accrue 20 years of service by age 50, or reach 25 years of service at any age. The exception for feds who retire at age 57 due to mandatory early retirement was included in the earlier text.
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Federal employees subject to mandatory early retirement are also exempt from the provision requiring employees to choose between “at-will” employment status or accepting a five percent increase to their FERS contribution rate.
