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Editorial: Retirees deserve full pensions on Day One

Jun. 2, 2013 - 01:59PM   |  
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More than two decades of effort and $100 million in costs have gone down the drain in trying to speed up processing full retirement pay for former federal employees. The Office of Personnel Management in that period slogged through four attempts to upgrade its information technology system, canceling the most recent effort five years ago.

OPM leadership now says that by 2016 or 2017, a major IT upgrade should be in place to accelerate pension processing. Good intentions aside, OPMs plans for the upgrade are not likely inspiring confidence among the thousands of federal retirees stuck waiting for OPM to calculate their full pension amounts, a process that can take months, sometimes a year or longer.

As OPM makes those calculations, retirees are forced to take less than full payouts until a final figure is validated. OPM, to its credit, has cut wait time to an average of 77 days from nearly twice that and improved pension payouts so that almost all retirees stuck in the backlog are receiving an estimated 90 percent of full payment.

But anything less than full retirement pay is simply unfair, period. Retirees earned their pensions fair and square and deserve better than to be forced to take partial payments, which essentially means they are subsidizing the federal government as it shortchanges them. And its so unnecessary.

For all federal workers who give sufficient notice of retirement 60 to 90 days should be ample OPM should calculate 100 percent pension payments and cut checks in those amounts from Day One. Err on the side of overpayment if it turns out after final calculations that retirees were overpaid, then they can reimburse that. Certainly any overpayments or inconvenience to the government will total far less than the $100 million wasted on the search for the perfect IT solution.

Ken Zawodny, OPMs associate director of retirement services, outlined an incremental approach to fixing the pension payout mess, rather than seeking a fully automated IT solution. He calls for establishing a Case Management System as the first in a series of IT upgrades to take on the huge task of incorporating employee data across all agencies, including information from before 2005, when records began to be digitized.

Taking on the pension problem in bite-size chunks makes sense after decades of searching for the perfect solution. However, OPM seeks to pay for the Case Management System by tapping the Civil Service Retirement and Disability Fund for $2.6 million in fiscal 2014. That requires congressional approval, and employee advocates have understandable reservations about taking retirement funds to help retirees get the retirement pay they are owed.

Congress instead should appropriate funding, set performance targets OPM leaders must meet in paying full pension amounts in a timely manner, and hold OPM officials accountable if they fail to do so.

Federal retirees have been getting the short end of this deal for far too long.

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