ADMINISTRATION FISCAL 1984 PROPOSALS

• Document Type: CREST
• Collection: General CIA Records
• Document Number (FOIA) /ESDN (CREST): CIA-RDP86B00338R000400620039-0
• Release Decision: RIFPUB
• Original Classification: K
• Document Page Count: 2
• Document Creation Date: December 21, 2016
• Document Release Date: September 16, 2008
• Sequence Number: 39
• Publication Date: March 17, 1983
• Content Type: OPEN SOURCE

Approved For Release 2008/09/16: CIA-RDP86B00338R000400620039-0
March 17, 1983
GRESSIONAL RECORD - Extensions of Remarks 1E 1091
EXTENS]IONS OF REMA
ADMINISTRATION FISCAL 1984
PROPOSALS
HON. THOMAS A. DASCHLE
OF SOUTH DAKOTA
IN THE HOUSE OF REPRESENTATIVES
Wednesday, March 16, 1983
o Mr. DASCHLE. Mr. Speaker, the ad-
ministration's budget for fiscal year
1984 contains many objectionable sec-
tions, but the one which I wish to ad-
dress today concerns the proposals for
drastic changes in the Civil Service
Retirement System. These proposals.
constitute another episode in the ad-
ministration's ongoing politically moti-
vated attacks on the Federal employ-
ee. In its recommendations to the
House Budget Committee, the Post
Office and Civil Service Committee on
which I serve has rejected these unfair
proposals, and I fully support the com-
mittee position on this issue. For the
benefit of my colleagues; I would like
to insert in the RECORD copies of the,
administration's proposals, and the po-
sition of the Post Office and Civil
Service Committee on them. The doc-
uments follow:
ADMINISTRATION FISCAL 1984 PROPOSALS
Federal employee retirement and disabil-
ity.-Federal employee retirement and dis-
ability programs include a number of Feder-
al employee retirement programs in the leg-
islative, judicial, and executive branches.
The largest program is the civil service re-
tirement and disability program. Outlays
for Federal employee retirement and dis-
ability are estimated to increase from $20.9
billion in 1983 to $22.2 billion in 1984.
Retirement and disability programs.-The
Federal employee retirement system is one
of the most generous pension plans availa-
ble in the United States. Workers' contribu-
tions cover only 20% of the cost of the
system; the Federal taxpayer pays the re-
maining 80%.
Legislation is proposed that would reform
the civil service system to deal with the
problems created- by these factors. This leg-
islative package includes:
Annuity adjustment for early retirement.-
Current law provides that civil service em-
ployees may retire as early as age 55 with 30
years service and receive full benefits. By
contrast, social security provides no retire-
ment benefits before age 62. The proposal
would continue to permit retirement at age
55 with 30 years service, but annuities would
be reduced by an actuarial factor-5% for
each year the worker chooses to retire prior
to age 65. This change would be phased in
over a period of 10 years, and employees age
55 or over at enactment would not be affect-
ed. The proposal is a responsible, measured
way to address the early retirement prob-
lem. Since the average age at which Federal
employees retire is 61, few will experience
the full reduction. In addition, the reduc-
tion would not apply to persons retiring be-
cause of disability.
Cost-of-living adjustments (COLAs).-As
part of a proposed Government-wide COLA
policy; this proposal would freeze the cost-
of-living adjustment for 1984. The proposal
KS
would also make permanent the current lim- Committee position.-There is no justifi-
itation on cost-of-living adjustments able basis to treat Federal retirees more
(COLAs) for non-disability retirees under harshly than beneficiaries of.other Federal
age 62 by allowing one-half the full COLA entitlement programs. The Administration
increase after 1985. Under current law, the proposes only a six-month delay in COLA
limitation of one-half of specified COLA in- for social security recipients and other
creases expires at the end of fiscal year beneficiaries. The Administration's budget
1985. contains no explanation for the difference
Increase employee deductions for retire- in treatment. A 13-month COLA delay for
ment.-Although retirement costs have sky- Federal retirees clearly is inequitable. The
rocketed, the amount withheld from Feder- Budget Committee should assume only that
al employees' salaries has remained con- amount of savings that would result from
stant at 7% since 1969. This has resulted in imposing the same six-month COLA delay
a significant departure from the principle on Federal retirees as is proposed for social
that employees should pay 50% of the cost security recipients.
of the retirement system. The ? proposal (Note.-An amendment offered in full
would increase employee deductions to 9% Committee to substitute the Administra-
in 1984 and to 11% in 1985. This represents tion's COLA proposal for the Committee
approximately one-half of the cost of civil recommendation was rejected by a record
service retirement, taking into account the vote of 3 to 19.)
other reforms proposed.
Increase employer deductions for retire- II. PAY FREEZE
ment.-Employer contributions for retire- Administration proposal-The Adminis-
ment would also increase to match the in- tration proposes to save $3.3 billion in FY
crease in employee deductions described 1984 by eliminating the October 1983 pay
above. This would include matching contri- increase, estimated at 6.5 percent 'by the Ad-
butions from other entities including the ministraton and 5.5 percent by CBO.
U.S.'Postal Service, and the District of Co-
lumbia Committee position.-The Federal em-
participate Government, for employees who
participate in the Civil Service Retirement ployees' pay increase has been capped the
System. past five years. As of October 1982. they
Base annuity calculations on the retirees' were 14.47 percent behind the private sector
highest 5 years of earnings, instead of the and, under the pay comparability provisions
current highest 3.-As recently as 1969, the of existing law, may be as much as 22 per-
formula for computing annuities was based cent behind by next October. Last year's
on the average of an employee's 5 highest four percent increase generally was eaten
salary years; since then the three highest up by the medicare tax and increased
salary year have been used. With a return health insurance premiums, resulting in a
to more moderate inflation levels, it is sensi- reduction in take-home pay. for many em-
ble to use the highest 5 years as the base. ployees. At a minimum, Federal employees
Employees within 3 years of retirement eli- should receive the four percent increase
gibility would not be affected by the asumed in last year's budget resolution.
change. This would result in savings of from $750
Modify replacement rates.-Currently, a million to $9 billion depending on whose es-
formula is used that determines the per- timate of comparability is used.
centage of salary that is replaced by retire- (Note.-An amendment offered in full
ment benefits. For example, this replace- Committee' to substitute the Administra-
ment rate is now 56.25% of the final 3 years' tion's pay freeze proposal for the Commit-
salary for 30 years of service. The adminis- tee recommendation was rejected by a
tration would alter this formula to reduce record vote of 4 to 18.)
the replacement rate, if necessary in con-
junction with other proposals, to reduce the CIVIL SERVICE RETIREMENT REVISIONS
cost of the system to 22% of payroll and Administration proposed.-The Adminis-
enable employer contributions to be limited tration proposes drastic reform of the civil
to 11% of salary. service retirement system including:
Federal employees workers' compensa- Increasing employee contributions from 7
tion.-Federal employees or their survivors percent to 9 percent in 1984 and from 9 per-
are provided tax-free cash and - medical cent to 11 percent in 1985;
benefits for job-related injuries, illnesses, or
deaths. About 47,000 workers with long- Reducing annuities by 5 percent for each
term disabilities, or their survivors are ex- year the employee is under age 65 at the
pected to receive monthly payments in 1984. time of retirement;
This is 1,000 fewer than in 1983 because of Calculating annuities on the basis of high-
increased efforts to return recipients to est average salary over five years rather
work and to remove those no longer eligible than three years; and
from the rolls. Outlays are estimated to de- Modifying the formula for computing an-
crease from $218 million in 1983 to $211 mil- nuities.
lion in 1984 as a result of the proposal to Committee position.-The civil service re-
delay the cost-of-living increase for 1 year. tirement system has been under attack since
1976
COMMITTEE ON POST OFFICE AND CIVIL SERV- when Congress repealed the one per-
COMMITTEE
constant
VIEWS AND RECOMMENDATIONS ON PRO- cent add-on each COLA. This lied in a
GRAMS UNDER COMMITTEE'S JURISDICTION total reduction chipping away y of fhas r$s resulted
bin.
in benefits of $6.7 7 billion.
1. CIVIL SERVICE RETIREMENT COLA The Committee does not intend to consider
Administration proposal.-The Adminis- the Administration's retirement proposals
tration proposes to save approximately $2 at this time. The proposal to extend social
billion over the next three years by elimi- security coverage to certain Federal employ-
nating the COLA due in May 1984. Civil ees and the impact of such proposal on the
service annuitants would receive the April civil service retirement system are more im-
1983 COLA but. would not receive another minent problems the Committee will have
COLA until June 1985-a 13-month delay. to address in the 98th Congress.
e This "bullet" symbol identifies statements or insertions which are not spoken by the Member on the floor.
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E 1092
0
CONGRESSIONAL RECORD - Extensions of Remarks March 17, 1983
IV. FEDERAL EMPLOYEE HEALTH BENEFITS
Administration proposal.-The Adminis-
tration proposes a major restructuring of
the FEHB program. Under the proposal
each employee would receive a fixed dollar
amount towards the purchase of health in-
surance. The amount would be based on the
average Government contribution for em-
ployee health insurance in 1983, indexed in
future years to reflect price increases. How-
ever, the proposed index would not reflect
the substantial annual increases in health
care costs. Our preliminary information
shows that the average Government contri-
bution for employee health benefits in fiscal
year 1984 would be reduced by $172. Exist-
ing law which limits the number of partici-
pating plans would be repealed.
Committee position.-We have witnessed
a steady erosion of Federal employee health
benefits under the present Administration.
Premiums have increased an average of 55
percent and the overall level of benefits has
substantially decreased. According to a
study conducted by William M. Mercer, Inc.,
the value of benefits under the FEHBP now
falls below the average value of benefits re-
ceived by employees in the private sector
and state government plans. While changes
in the FEHBP are warranted, it is clear that
the sole objective of this Administration
with respect to the FEHBP is simply to
reduce outlays-not improve the program.
Our Committee prefers to achieve savings
through program improvements and not
through arbitrary cuts in the Government's
contribution.
V. CLASSIFICATION REVIEW
Administration proposals.-The Presi-
dent's budget assumed savings of $700 mil-
lion resulting from a review of the manner
in which Federal jobs are classified.
Committee Position.-The Budget Com-
mittee should not assume savings of $700
million resulting from the proposed classifi-
cation review since the President's assumed
savings are undocumented, and the Commit-
tee does not believe that such savings can be
realized under existing provisions of law..
HON. JOSEPH G. MINISH
OF NEW JERSEY
IN THE HOUSE OF REPRESENTATIVES
Wednesday, March 16, 1983
? Mr. MINISH. Mr. Speaker, I have
been saddened to learn of the death at
the young age of 20 of Mr. Timothy
Hunt of Montclair, NJ. Tim came to
work in my office as an intern late in
1981, and he immediately made his
cheerful, cooperative, and energetic
personality into a major asset to the
staff, constituents, and visitors who
came into contact with him. He
worked hard and loved being here and
learning about the Congress. Although
illness cut short his time with us, he
looked forward to returning in the
next summer, and he kept in touch
with calls and visits to the office
which were always welcome. Tim Hunt
earned our affection and respect.
Born in Glen Ridge, N.J., Tim was
valedictorian of his graduating class at
Montclair High School. He went on to
become an honor student at the
Georgetown School of Foreign Serv-
ice, preparing for what surely would
have been a distinguished career in
the service of our country.
Our deepest sympthy goes to Tim's
parents, Donald and Maxine Hunt; his
sisters, Laura Claire Hunt and Marcia
Carol Goldberg; and his grandmother,
Anne Hunt. His presence in my office
gave some idea of the loss they suffer.
It is also our country's loss, since Tim
was a good citizen and a good man
whose strong character and kind dis-
position promised much for the
future..
HON. PETER H. KOSTMAYER
OF PENNSYLVANIA
IN THE HOUSE OF REPRESENTATIVES
Wednesday, March 16, 1983
? Mr. KOSTMAYER. Mr. Speaker,
the notion of a free and open ex-
change of ideas is an American cliche.
This tolerance for the diversity and
variety of human opinion goes to the
soul of American life.
Yet twice recently, this administra-
tion-which constantly reminds us of
its committment to getting the Gov-
ernment off our backs, has assaulted
this historic process in the name of
"national security."
The Department of Justice has in-
voked an obscure provision of the For-
eign Agents Registration Act requiring
.three Canadian films recently released
in this country to carry a disclaimer
stating that they have been registered
with the Department of Justice but
that this registration "does not indi-
cate approval of the contents of this
material by the United States Govern-
ment." Furthermore, records will be
kept of the names of groups, schools,
libraries, and private institutions that
have asked to see the films.
This intrusive and intimidating con-
duct has no place in a free society.
The Justice Department should not
render political judgements that are
better made by American citizens.
Rather, it should concern itself with
crime, not the dissemination of ideas.
Fresh from rescuing us from the Ca-
nadian films, the administration dis-
covered yet another threat in the form
of 68-year-old Hortensia Allende, the
widow of the late Chilean President,
Salvador Allende. She was denied a
visa to travel from her, home in
Mexico City to speak to church groups
in San Francisco on the subject of
human rights and women's rights. The
State Department said her presence in
this country would be prejudicial to
the interests of the United States.
It has never been in the interests of
the people of the United States for the
Government to decide who shall speak
and who shall not.
Contrary to what the administration-
says, it is they, not Mrs. Allende or the
Canadian films, which pose the real
danger to America.
REFUNDABILITY OF THE
DEPENDENT CARE TAX CREDIT
HON. BARBARA A. MIKULSKI
OF MARYLAND
IN THE HOUSE OF REPRESENTATIVES
Wednesday, March 16, 1988 .
? Ms. MIKULSKI. Mr. Speaker, I am
pleased to be joined by my colleagues
Mr. SHANNON and Mr. DOWNEY to in-
troduce legislation making the depend-
ent care tax credit refundable. This
legislation is directed' toward the needs
of low-income families-families
caught in-the earnings gap between
two forms of child care assistance.
These are families who are working
and earning too much to qualify for
AFDC or title XX child care programs
but who do not earn enough to benefit
from the tax credit program.
A refundable credit will allow fami-
lies to receive a refund in the amount
of the credit they could have claimed
had they earned enough to pay
income taxes.
The benefit of assisting low-income
earners through the Tax Code rather
than through other forms of Federal
subsidies is that the choice or appro-
priate child care remains with the
family. The refundability provision
will reimburse,families for a portion of
their child care expenses regardless of
whether they send their children to a
child care center in the neighborhood
church or hire the children's grand-
parent to stay with the children after
school.
This bill is part of the Women's Eco-
nomic Equity Act, introduced today in
both the House and the Senate. I urge
my colleagues to support this legisla-
tion..
SECOND PHASE OF JOBS BILL
NEEDED
SPEECH OF
HON. BARBARA B. KENNELLY
OF CONNECTICUT
IN THE HOUSE OF REPRESENTATIVES
Thursday, March 3, 1983
? Mrs. KENNELLY. Mr. Speaker,
today as we begin consideration of the
jobs bill, we no doubt are going to hear
a great deal about how the 'recovery
has begun in this country. We are
thankful for the many bright signs;
however, for millions of Americans
there has not been any recovery yet
and there might not be one unless we
do the right thing. Recovery will not
begin unless we address training and
retraining of the American people.
I am not saying that today's bill is
not good, in fact it is a good jobs bill,
but it is not enough. For example, over
$700 million is designated to go toward
public services, toward jobs that
women usually hold. This is not noth-
ing; it is a lot "of money. But we can
use more as far as retraining and new
training for women so that they, who
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