Veterans Hit Hard By Plans to Attack Federal Employee Pensions

Veterans working for U.S. government face 10 -12 percent pay cut under proposed plan

WASHINGTON, May 18, 2011 /PRNewswire-USNewswire/ -- The American Federation of Government Employees (AFGE), the nation's largest federal employee union serving thousands of veterans nationwide, today expressed outrage at proposed plans to reduce the national deficit by attacking federal employee pensions. Under the deficit reduction plan proposed by former senator Alan Simpson (R-Wyo.) and former Clinton chief of staff Erskine Bowles, veterans working for the federal government caring for our nation's veterans could face a 10-12 percent pay cut.

This would have a devastating impact on working families, particularly our nation's veterans, AFGE said. Thousands of our servicemen and women return home from war and continue their service as federal employees, including many who work at the VA to assist other veterans and their families.

"This idea of balancing the federal budget and reducing the deficit on the backs of federal employees, many of whom are war veterans, is outrageous," said AFGE National Secretary-Treasurer J. David Cox. "Our veterans have risked life and limb to serve this country. Those who have come into the federal government to continue their service to the American people are faced with continuous attacks as government employees. Under the Simpson-Bowles plan, they face unprecedented cuts to their salaries and pensions. Many of those workers providing those essential services are veterans and should not have their pay and benefits thrown on the chopping block for political gain. This is no way to honor America's vets."

Our men and women in uniform face many challenges, seen and unseen, when they return from their tours of service. Employees within the Department of Veterans Affairs and other sectors of the federal government work tirelessly to provide the medical care and benefits that America's veterans deserve. Other veteran service organizations have reached out to AFGE and expressed their dismay over current plans to attack federal employee pensions.

The Simpson-Bowles recommendation calls for Federal Employee Retirement System (FERS) employees to contribute approximately 7 percent of their salary to their defined benefit pension (instead of the current 0.8 percent contribution). Combined with the 6.2 percent contribution to Social Security and 5 percent to the Thrift Savings Plan (needed to receive the matching government contribution), this will skyrocket federal employees' retirement spending to 18.2 percent of their salary. The vast majority of federal employees, including many service-connected veterans earning modest wages at the VA and other federal agencies, would be hit hard by this proposal - making it virtually impossible for them to afford daily living expenses.

As a result, government employees would be forced to withdraw their contribution to the TSP in order to have enough to contribute 7 percent to their defined benefit pension, setting off a chain of events that will cause them to lose out on future earnings of their own savings. Changing the structure of the pension program effectively will be a 10-12 percent pay cut for these employees.

AFGE urges lawmakers to oppose these types of dangerous proposals that will undoubtedly destroy the middle-class status of federal employees and create undue hardships on veterans serving in the federal government.

The American Federation of Government Employees (AFGE) is the largest federal employee union, representing 625,000 workers in the federal government and the government of the District of Columbia. Visit www.afge.org.

SOURCE American Federation of Government Employees

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