According to Lagradaonline, changes are on the horizon for Social Security beneficiaries as the U.S. House of Representatives addresses two long-standing provisions that have affected workers and their families: the 1983 Windfall Elimination Provision (WEP) and the 1977 Government Pension Offset (GPO).
These provisions have created challenges for many public workers, but the new legislation promises relief.
The Windfall Elimination Provision (WEP)
The WEP was introduced by Congress to adjust Social Security benefits for individuals who receive pensions from jobs that don’t withhold Social Security taxes, typically state and local government employees or non-U.S. employers.
The goal was to prevent workers from receiving higher Social Security benefits than those who have worked and contributed to Social Security their entire careers. According to the Social Security Administration (SSA), the formula used under WEP is meant to limit the benefits for those who have a combination of both non-covered pensions and Social Security-covered earnings.
The Government Pension Offset (GPO)
Similarly, the GPO reduces the Social Security spousal or widow(er) benefits for individuals who also receive non-covered pensions. This provision was designed to ensure that both covered and non-covered lifetime earners receive equal benefits, but it often results in a significant reduction or complete offset of spousal or widow(er) benefits. For example, the GPO reduces benefits by two-thirds of the monthly non-covered pension, which could effectively eliminate the spousal benefits for those affected.
Why the Changes Are Needed
When these provisions were implemented, they were intended to address inequities in the Social Security system, but they have not adapted to the changing landscape of pensions.
Today, many public workers and surviving spouses who have worked in both the private and public sectors are facing much lower benefits than they deserve. With the increase in life expectancy and rising costs, these reductions often leave workers and their families struggling financially.
The Social Security Fairness Act of 2023 (H.R. 82)
To address these issues, lawmakers introduced the Social Security Fairness Act of 2023, also known as H.R. 82. This bill aims to repeal both the WEP and GPO, allowing public workers and their spouses to receive their full Social Security benefits regardless of their pension status. By eliminating these provisions, the legislation would ensure that workers who have contributed to both the public and private sectors can access the full benefits they are entitled to.
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The Social Security Fairness Act has garnered strong bipartisan support. Reps. Garrett Graves (R-LA) and Abigail Spanberger (D-VA) sponsored the bill, and it is backed by key figures such as Sens. Sherrod Brown (D-OH) and Susan Collins (R-ME), as well as House Speaker Mike Johnson (R-LA). The bill’s popularity means it has a good chance of passing through the House, potentially through a voice vote, although a recorded vote would require two-thirds support.
Budgetary Concerns and Potential Impact
However, the Congressional Budget Office (CBO) has estimated that repealing the WEP and GPO could cost the Social Security program about $196 billion over the next decade. While this would put additional strain on an already financially burdened system, the personal stories from law enforcement officers, firefighters, and other public servants, who have seen their benefits drastically reduced, have helped rally support for the bill.
What’s Next?
Once the bill passes the House, it will move to the Senate, where it is also expected to pass due to its broad public support. If signed into law by the president, the changes would apply to Social Security benefits payable after December 2023.
For those who have been negatively impacted by the WEP and GPO provisions, this legislative shift is a major win that will ensure they receive the full benefits they’ve earned.
