The Government Pension Offset and the Windfall Elimination Provision are poorly written laws that have been levied against public workers for nearly forty years. They are particularly harsh against women.
The formula for the Windfall Elimination Provision does not produce the effect that it was designed to do. It has a harsher effect on retirees who have had lower-paying jobs and lower pensions. Currently, the one way of mitigating its effects requires a level of “substantial” yearly FICA earnings for 20-30 years. This level of “substantial” earnings discriminates against women who have been more likely to work at part time or low-paying jobs. Women are 43% of those affected by the WEP–currently nearly 780,000 thousand retired women.
Particularly egregious, the Government Pension Offset currently affects more than 700,000 retirees, 83% of them women. The GPO reduces and usually eliminates all spousal and survivor benefits. More than 70% of retirees affected get none of their earned benefits. The GPO formula results in an average loss of $555 a month for men, but $745 for women. A spouse who has been married for at least ten years normally earns both spousal and survivor benefits that their marriage partner has paid into FICA for them. The GPO ignores the 10-year dependency rule and eliminates the spousal or survivor benefit based on the spouse’s earning of a government pension which might not even have been earned during that marriage. The GPO continues to increase its penalties over the years for those who actually receive benefits, since, if the government pension recipient is given a raise, the law requires that person to report the raise to the Social Security Administration. If the raise is for $30 a month, then the spousal or survivor benefit is reduced by $20. Every other retiree gets $30 a month cost of living, but the GPO affected senior only gets $10.
The WEP and GPO affect retirees in every state, and they have their harshest effects on lower income public employees: mail carriers, teachers, school bus drivers, police and fire employees with partial careers, city secretaries, and clerks. Their pensions are both taxed differently in different states and earned differently than Social Security benefits. Balancing a public pension’s benefits against Social Security benefits is inherently unfair and indefensible legislation. The Windfall Elimination Provision and the Government Pension Offset must be repealed!
(Figures from CRS Reports RL 32453, and 98-35)