As approved by the House Committee on Oversight and Government Reform on April 26, 2012
H. Con. Res. 112, the Concurrent Budget Resolution for fiscal year 2013, as passed by the House of Representatives on March 29, 2012, instructed several committees of the House to recommend legislative changes that would reduce deficits over the 2012-2022 period. As part of this process, the House Committee on Oversight and Government Reform was instructed to recommend changes to current law that would reduce the deficit by $78.9 billion for fiscal years 2012 through 2022.
The proposal by the House Committee on Oversight and Government Reform would make several changes to the current federal employee retirement program. Specifically, the legislation would increase the percentage of salary that federal employees in the Civil Service Retirement System (CSRS) and Federal Employees Retirement System (FERS) are required to pay towards their retirement and eliminate the FERS retirement supplement that would be paid under current law to certain future retirees under the age of 62. The proposal also would allow federal employees to contribute to their Thrift Savings Plan (TSP) accounts any payment received at retirement for accumulated and accrued annual leave.
CBO and the staff of the Joint Committee on Taxation (JCT) estimate that this proposal would have no impact in 2012, and would reduce deficits by $2.3 billion in 2013 and by $83.3 billion over the 2013-2022 period. Those estimates are relative to CBO’s March baseline projections and assume enactment on or near October 1, 2012. The reduction is achieved mostly through an increase in estimated revenues—$2.4 billion in 2013 and $87.8 billion over the 10-year period—partially offset by higher direct spending ($0.2 billion in 2013 and nearly $4.5 billion over the 2013-2022 period). The estimate of budgetary effects would be the same whether enactment is assumed to occur by July 1, 2012, or around October 1, 2012, because the retirement proposals would not take effect until January 1, 2013, while the TSP proposal would not take effect until one year after enactment.
The legislation contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act (UMRA) and would impose no costs on state, local or tribal governments.