Feds to Get Biggest Cost of Living Adjustment Since 2012
Despite the continuous back-and-forth and uncertainty that has marked much of the year’s debate surrounding pay for federal employees, next year’s cost of living adjustment (COLA) is slated to be the largest adjustment federal retirees have received since 2012.
Mike Causey of Federal News Network notes that the change “impacts more people than any other benefit rise in the nation,” with most federal employees seeing an increase of 2 percent. But the adjustment will be especially kind to retired federal employees, specifically those who retired under the Civil Service Retirement System (CSRS), who will see a COLA of 2.8 percent.
The changes will take effect beginning January 2019, with the adjustment “based on the increase in living costs from the current quarter from July to September 2018, over the third quarter of 2017,” according to the Consumer Price Index.
The National Active and Retired Employees Association (NARFE) welcomed the change, but noted that the discrepancy between the adjustment received by employees under the current FERS system and retired employees under the CSRS system is a policy in need of a fix.
”CSRS retirees and Social Security recipients will be pleased to see their benefits increase by 2.8 percent in 2019, the largest increase since 2012. Unfortunately, hundreds of thousands of FERS retirees will be wondering why they are only receiving a 2 percent COLA when the relevant measure of consumer prices increased by 2.8 percent. That’s due to the bargain struck in Congress in the 1980s when FERS was created, which limits COLAs to 2 percent when consumer prices increase between 2 and 3 percent,” NARFE explained in a statement. “But that was the wrong policy then, as it is now. It prevents FERS annuities from keeping up with inflation, which is the whole point of a COLA. It is past time for Congress to ensure FERS retirees receive a full COLA each year.”
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