Currently, the defined benefit Congressional pension plan gives federal lawmakers, who have served at least five years, an annual payment equal to 1.7% of their salary (currently $174,000) for the first 20 years and an additional 1% for each year served after the 20 year mark. Members of Congress are required to pay 1.3% of their annual salary into the pension plan.
“These are extremely difficult economic times and we are in a debt crisis that will require sacrifices on the part of all Americans,” said Coffman. “Congress needs to set an example for the country and I believe that ending our pension plan would be a good start.”
While Coffman’s legislation would prohibit current or future members from receiving any credits for additional years of service, it would honor any retirement benefits already accrued before his bill takes effect. Members of Congress are also still required to pay into Social Security and can participate in the Federal Thrift Savings Plan (401k), which is available to all federal employees.
In January, Coffman introduced House Resolution 270 that would cut Congressional pay by 10%, reduce Congressional office budgets, and require federal civilian employees to take a non-consecutive, two-week furlough in 2012. An exception is provided in the legislation for federal employees involved in national security or for reasons related to public safety including law enforcement. The 5% reduction in congressional office budgets was adopted as part of the recent debt ceiling agreement.
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