Republican Leadership Proposes Tapping Federal Pensions to Pay for Student Loan Interest Rate Extension
Last week, House and Senate Republican leadership penned a letter to President Obama offering their proposals to prevent student loan interest rates from increasing. Their plan for funding the extension? Dipping into your retirement savings.
Signed by Speaker John Boehner (R-OH), House Majority Leader Eric Canter (R-VA), Senate Minority Leader Mitch McConnell (R-KY), and Senate Republican Whip Jon Kyl (R-AZ), the letter calls for a 1.2% increase in the amount current employees contribute toward their pensions. Phased in by increments of 0.4% each year through 2015, the measure would increase contributions for both Federal Employee Retirement System and Civil Service Retirement System enrollees.
This plan would hurt millions of federal employees who have already sacrificed a total of $75 billion dollars over the next decade through a two year pay freeze and an earlier increase in retirement contributions. A second dip into their modest retirement benefit would cause a dramatic effect in communities all throughout the country, where 85% of federal employees live and work.
“While we adamantly support the extension of the student loan interest rate, it is simply unacceptable to expect federal workers to foot the bill,” said NFFE National President William R. Dougan. “It is wrong for Congress to keep reaching into middle class federal employees’ pockets to pay for unrelated legislation. Federal workers and their families have sacrificed more than enough.”
These attacks on federal workers could not come at a worse time for the federal government. Federal retirements have been surging to record levels is recent years, and fewer and fewer young Americans find federal employment attractive. If we are to attract the next generation of nurses, food safety inspectors, and firefighters into public service, they must be offered meaningful retirement security.