Government Pension Offset, Windfall Elimination and Your Retirement Future

The Windfall Elimination Provision and the Government Pension Offset can impact your retirement future. Several readers have asked about the potential for repeal of these provisions because of its impact on their retirement future. Here is an update.

A little over a year ago I wrote an article about legislation to repeal the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO). Since that time we have had an election and seated a new Congress, however the advice I gave in 2008 in an article entitled Don’t Hold Your Breath is as good now as it was then.

The WEP and GPO can affect the Social Security benefits of CSRS retirees, CSRS Offset retirees and FERS retirees who have a CSRS component to their annuity (TransFERS). They can also affect the Social Security of anyone who is collecting a pension from work that was not covered by Social Security, such as teachers, public safety employees and others. Articles which explain these provisions in detail appeared in fedsmith in late 2007. See The Government Pension Offset and Windfall Elimination and Your Retirement Future.

Ever since the WEP and GPO became law, bills have been introduced to repeal them. None of the bills have passed. In my memory, a repeal bill has never made it out of the House Ways and Means Committee. Even though this session of Congress is only the second session since the enactment of the WEP and GPO where we have a Democratic President and a Democratic Congress, I expect no different this year.

I visited the website of the National Association of Active and Retired Federal Employees on March 23rd to look at the status of House Bill 235. (NARFE restricts most areas of its website to members. Therefore, if you’re not a member, you will not be able to access the "Legislative Action Center" where I found this information.) I found that 238 members of the House of Representatives had signed on as co-sponsors. That and $2.00 will get me a ride on the "L".

Co-sponsorship of HR 235 simply means that a Representative wants to appear to support issues that are important to federal employees. In fact, the repeal bill in the last session of Congress had over ¾ of Congress listed as co-sponsors, including a majority of the Ways and Means Committee. The words of Christopher Farrell, a legislative representative of NARFE, explain why co-sponsorship isn’t that big a deal. In a February 2008 article in the NARFE magazine, he said "Cosponsorship is reversible – a cosponsor can ask to be removed from the cosponsors of the bill. In sharp contrast, floor votes are final. In fact, cosponsorship can be quite disingenuous. Members can and do vote against bills they have cosponsored."

So what can we do? We can still write or email our elected representatives asking for their support. If your Congressperson is not a co-sponsor, ask them to sign on as a co-sponsor and to support the bill if it comes up for a floor vote. If your Congressperson is a co-sponsor, ask them to do whatever they can to get the bill on the floor for a vote. If your Congressperson is a member of the Ways and Means Committee, ask them to send the bill to the floor of the House for a vote once it gets to committee (which it certainly will).

This year we have another argument we can use when trying to convince our Congresspeople to support repeal. Any additional money given to retirees will go directly into the economy. Retirees are through saving; they are spending and will provide an immediate stimulus to the economy.

My trip to the NARFE website showed me that my Congressman has not yet signed on as a co-sponsor. As soon as I finish this article, I’m going to write him a letter.

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About the Author

John Grobe is President of Federal Career Experts, a firm that provides pre-retirement training and seminars to a wide variety of federal agencies. FCE’s instructors are all retired federal retirement specialists who educate class participants on the ins and outs of federal retirement and benefits; there is never an attempt to influence participants to invest a certain way, or to purchase any financial products. John and FCE specialize in retirement for special category employees, such as law enforcement officers.