From the August 2003 Idaho Observer:

Congressional retirement plan: Not quite as bad as we thought

Every year we get to be disgusted because Congress, which has devolved to a useless debating society, votes itself a pay raise. Wouldn't it be nice to pretend to represent the conscience of a nation ruled almost totally by executive orders and still be able to vote to increase one's own salary? Wouldn't it be best for our purposes if Congress had a retirement in keeping with the outrageous salaries and perks they receive while in office? Well, I am sorry to say, it's not quite as absurd as we had perversely hoped.

By Don Harkins

In the August, 2002 edition of The Idaho Observer, we published a description of the congressional retirement plan on page 2. The plan, as described and as taken from a post that had been going around on the Internet, sounded much worse than it, apparently, really is.

The description caused an IO reader to write a letter to the editor of his local newspaper -- which was rebutted (emotionally rather than authoritatively).

So, it appeared clarification was in order. I wrote to Senator Craig (R-Idaho) and asked for the definitive explanation of the Congressional Retirement Plan. Senator Craig's office forwarded me the Congressional Research Service (CRS) Report for Congress on the Retirement Benefits for Members of Congress (updated September, 2002).

It has been my experience that CRS reports to Congress on a variety of subjects have been absolutely objective and accurate.

The mis-reported plan

“For all practical purposes, their plan works like this: When they retire, they continue to draw the same pay until the day they die, except that it may increase from time to time for cost-of-living adjustments.”

The reported plan also said recipients pay nothing into the plan, they draw benefits from the General fund and monthly checks will keep coming to husbands or wives should they survive the congressperson.

The CRS-reported plan

Members of Congress have been paying into Social Security (SS) since 1984. Prior to 1984 they were covered under the Civil Service Retirement System (CSRS). They now have both CSRS and SS.

Those elected after January 1, 1984, have SS and the Federal Employees Retirement System (FERS) benefits. Pre-1984 members of Congress can trade their CSRS benefits for FERS.

So, the full list of retirement plan options for members of Congress are:

1. Full coverage under SS and CSRS

2. The “CSRS Offset” plan, which includes both CSRS and SS, but with CSRS contributions and benefits reduced by SS contributions and benefits.

3. FERS plus SS

4. SS alone

“All members pay SS payroll taxes equal to 6.2% of the SS taxable wage base of ($84,900 in 2002). Members covered by FERS pay 1.3% of full salary to the Civil Service Retirement and Disability Fund. [Congress kicks in 11% of the Members' salary as its contribution]. Members covered by CSRS Offset pay 1.8% of the first $84,900 of salary and 8.0% of salary above this amount into the Civil Service Retirement and Disability Fund.

“As of October 1, 2000, 409 retired Members of Congress were receiving federal pensions based fully or in part on their congressional service. Of this number, 356 had retired under CSRS and were receiving an average annual pension of $52,464. Fifty-three Members had retired either with service under both CSRS and FERS or with service under FERS only. Their average annual pension was $46,932 in 2000.”


Under CSRS, “Members” become legally qualified to receive retirement benefits after five years of service. Depending upon the age of the retiree, the benefits can begin paying immediately or be deferred.

Members aged 60+ with 10 years of service or aged 62 with five years of service are eligible for full and immediate pension.

Members age 55-59 with at least 30 years of service can receive an immediate but reduced pension so long as they did not resign or be removed from office.

Retirement under FERS is comparable.

An example was given for a Rep. or Senator retiring after Dec., 2002, with 26 years of service (7 under CSRS, 19 under FERS). With an ending “high-3” salary of $138,233, their annual pension would be $72,442 per year.

As of 1999, the average SS retiree received $804 per month, or $9,648 annually after retiring at age 65.

Cost of living adjustments for federal retirements are made annually based upon the Consumer Price Index.

Members may participate in the “Thrift Savings Plan” which is similar to a 401(k) in the private sector.

The CRS report made no mention of whether or not benefits transfer to a spouse after death. The report also did not address medical coverages.

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