EARLY RETIREMENT INCENTIVES

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP84-00780R002400020037-6
• Release Decision: RIPPUB
• Original Classification: S
• Document Page Count: 5
• Document Creation Date: December 19, 2016
• Document Release Date: August 29, 2006
• Sequence Number: 37
• Publication Date: May 9, 1968
• Content Type: MF

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MEMORANDUM FOR: Executive Director-Comptroller
Deputy Director for Support
SUBJECT : Early Retirement Isaentives
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1. Judging front the responses I have received regarding several
proposals I have made oe this subject, there is very little community of
understanding as to what it is the Ageney Is trying to accomplish, what the
true problems are, and what the feasible courses of settee are. People
persist in failing to differentiate between the problems of Directorates
predominantly or si,gnificantly concerned with overseas operations and
Wipe sot so involved. They seek to give benefits not directly related to
the member of years of government or agency service (a cardinal rule of
every retirement or separation system that I have any famillerity with).
Finally, they either propose solutions that require legislation while de-
crying the feasibility of obtaining legislation, or solutions without legislatioa that would require such selectivity ia applicability as to fail in the
basic objectives.
2. In order to come to grips with the matter, I strongly urge we
first define the true problems we are trying to solve. To my mind, they
are very clam and are the following:
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Problem No. 1: The Agemcy has a serious problem concerning
the adlization until age 60 of la employees ivhose careers have been
towed toward work abroad. There are not sufficieet assignments
abroad for lime numbers of employees ever age 30 and neither are
there sufficient headquarters essigmusets for them. The CIA Retire-
wet System was designed to solve this problem through its provisions
for voluntary or involuntary early retirement (age 30).
k is now clear that thel right to retire as early SS age 50
even with the substantially higher annuity (3.75% x high five salary)
is not itefficient incentive to Waste enough officers to exercise
this option. In my opinion, this le din to two broad factors:
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a. The seeking of II /NM field of vocational endeavor
after a career of specialinstlea in an arcane field of work is
generally difficult, time consuming. and anquinsive . This
generates caution and self-doubts and, of course, concern
for one's fillencial welfare during the transitional period.
Th. fact that can has an annuity of 50 or so percent of one's
former salary is most helpful and promises a greatly aug-
mented income if one is sencessful in making the "right"
vocational transfer. la the interim period, however, there
is anions risk of income impairment and the need, perhaps.
to eater a less than fully astistactory field of employment.
b. Agency employees, by demonstrated choice,
training, and experient* are generally not oriented toward
commercial employment. They are basically activated to
work for the Govezmnent or in equivalent intellectual pursuits,
and they thoroughly espy their Agency work and their career-
keg ameciattens with Agency colleagues. They tend to over-
look the fact that if they cannot)* placed In worthY gad
challenging heedquartere assignments during the final five
to ten years of their career, they will certately be mhappy
aad a millstone around dm neck of the Army.
It is also clear that the Agency does not feel that it can
Iskenelvely utilize its involuntary retirement rights by operating
-mime sort ole selection-out program on ? regular heals. I can
appreciate the fears of management ha this regard in terms of
security hoards end morale considuetions . I believe, however,
that the problems of inducing more employees to want to retire
early or to gracefully accept involuntary early retirement can
beak solved if the means is provided to eligible employees to
efface* career reoriethation without grave financial expense and
hazard. The solution is simply to provide assurance that their
expendable incases will not be impaired in the prices..
One solution Is cosh espplements to earned annuities for
treasonable period of time . An alternative, far more costly to
Government and far less feasible, is to increase annuities
tOh an extent that the individual mut leave without serious ck?ubts
financial security. Slate the basic annuity after 20 to 25
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years of service will be
Is utterly unrealistic to
sufficiently to overcome
to early retireasent
to ISM of high five salary, it
the fefrmtda cetdd be improved
firmincial and psychological obetacles
In smunuiry, some form of cash supplement must be added
to the.rned annuity to make the ides of early retirement an ac-
cepted risk. Whether this is done telth legislatiou or under existing
Agency authority is not material. If the latter, and some subterfuge
must be employed, the Agency should unethelees pave the way for
Its action by honest discussion with its Congressional committees,
the itireau of the Budget. and possibly other Government officials.
In this connection, there is strong argtanentation that such expendi-
tures are warranted exclusively by CIA in terms of the arcane nature
of the career duties of these people and the grievous security risks
involved in their alienation.
Problem No. 2: In askialf,Indeed requiring, Civil Service
employees to retire at age 60, there can be no doubt but that their
normal rights as Government employees have necessarily been
subordinated to the best interests of the Government. There can
be no doubt tot that they are severely penalised fimacially ? through
loss of salary and creditable service affecting both their atundty
mAdtiplier (2% each additional year) and probably their high five
salary
Simple equity and compelling needs to preserve the Asenci's
4reput5tion u a preferred employer wa
of some sort. Agaia, the eptilee are two -
the sumulty formula or supplementary cash payments.
3, From the above, the different nature of the two problems is
spparent* Although the objective* and justifications differ, the available
solutions ale of the same type in each case. Preferably compatible sobriety;
should be Waned even though the problems and the justifications for remedial
action are different .
4. la conclusion, in taking up the sub
Peleeetion, I would:
a. Obtain agree:nem es to vest the beak problems are -
preelsely noting the dissimaseeters.
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b. Decide whether hacreased annuities or supplementary
payments is the preferable and moat responsive solution.
C. Modify the conclusions in b. by deciding the feasibility
of obtaining legislation which would absolutely be necessary to
increase annuities .
d. If the preferred solution is supplementary cash payments,
devise an equitable and adequate formula.
a ? Prepare the proposal and the arranentation and pursue
the right or political sanction to effect it.
pociU Assistantto the
Deputy Director for Support
for Special Studies
SA-1)D/S/SS/EDE:1,ak(9 May 68)
Distribution:
Orig. - ExDir-Compt
1 - DD/S
1- ER
doe: DD/S Subject
1 DD/S Chrono Ref
1 - EDEchols
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