New-York tribune., 1907-06-26
CIVIL PENSIONS PLAN.
FOR FEDERAL EMPLOYEES.
4nnuitieS Based on SerJice and
Salary PrOCided For.
From The Tribune Rureau !

Washington. June 25.-FUll details OF the admin
istrattons plan FOR the creation of civil pension
patches 20 The Tribune of May 19.
peted Il is proposed in general to retire civil
employees at the age of seventy years. 10 pay them
pensions based on the length Of their service and
the amount of compensation at the time of retire
ment, and to institute system Of assessments by
which the government Will ultimately be relieved
of all expense.
is estimated the first year of its operation
the system would entail an expense on the GOV
ernment OF s2500 that this expense would increase
annually until, the end of thirty years. it at
tained the maximum Of S1746.56l after which there
would be a steady decrease until ultimately the
assessments would defray the entire cost These
figures are based on careful calculations. which
have been supervised by expert actuaries.
Apart from the humane considerations. it is be-
lieyed by those who have given careful study to
the reorganization OF the federal service that II
would so far make for increased efficiency 10
render it an economical investment An experience
in the General Land Office illustrates this
ment Until tho recent reorganization undertaken
by Judge Balinger, It has been the custom to have
all land patents and their records prepared in long
hand. The highest record OF efficiency thirty
patents day. Judge BallinEer recently dismissed
number Of the Oldest employees and filed their
places with expert typewriters. Now 1t is not
uncommon for single operator 10 write l25 patents
IN day together with an equal number of records.
that the efficiency OF of the clerks IS
TO |. compared with the older employees
REPORT OF sUB-COMMITTEE.
The subject Of personnel including the difficult
question of replacing superannuated employees With
younger clerks. conflded a subcommittee
of the Keep Commission. In it's final report this
committee disapproved equally any proposal that
pensions be paid to retired employees wholly out
Of the Federal Treasury and all measures prOvid
ing for a uniform deduction Of a given per cent
fiat rate" assessment salaries. All such prove
on analysis unfair either TO taxpayers or en-
poyes, It declares
The members OF the committee say they have
taken pains not only 70 study the details of the
plan recommended by them. as well as many
others. but submit it TO the criticism Of sew
eral expert professional actuaries, and to have
computations made so that all necessary data may
be at hand. The general idea Of their measure is
that each individual shall provide the necessary
fund for his retirement
II Is proposed TO pay every employe in the Civil
Service retiring at the age of seventy years or
upward annuity equal to is per cent OF his pay
for every year OF service. To Illustrate, take an
employe who entered the service at twenty years
Of age receiving a salary of $500 year through
fifty years and retired at seventy one ana one
half per cent OF 81 200 Is SIS This amount multi
piled by fifty (his years OF servce) gives 500 the
amount of his annuity for the remainder or his
life To provide the fund from which TO pay this
annuity a deduction will be made from the monthly
salary of the employee of amount which will be
sufficient with / per cent compound interest to
purchase such annuity on his arrival at the age
of seventy years.
panies 1t is found that S6.67S is the which
must be accumulated to purchase an annuity or S%0
for life for person seventy years of age. The next
step is TO determine what sum must he set aside
monthly accumulate at per cent interest S66IS
during the employees fifty years OF service. n de-
posit of 81 Il month for nifty years. with interest
compounded at 1 per cent. amounts to S1S7l IS.
The number of dollars month necessary TO aCcu-
muate 667S obtained by dividing 6.6S by LS5l. ~
This gives g 81 10 be deducted from salary of
500 q month to provide the annuity of $500 year.
DETAILS OF THE SCHEME.
The artthmetical process above illustrated, ap
piled all rates OF salary and all terms of ser
vice will result in annuity for each person
proportional to the amount of his salary and the
number OF years he has served the government.
Proper provision is made for tho withdrawal Of
the employees accumulated savings with interest.
in case no leaves the service before reaching the
age of retirement. While the age of retirement is
fixed seventy. generally. IN certain lines. ii is
recommended that 1t be made siXty-fve sixty
years. Retirement is not altogether compulsory.
as competent persons may be retained as long
they wish TO remain and render adequate
service.
in the service when the bill is passed II is
proposed that the government shall contribute the
amount necessary 10 represent their accumuations
from the time they entered the service. From the
passage n the bill they WILL of make their
contributions upon the basis above described
The sum contributed by the government 10 make
up the purchase money for the annuity of each
employe cannot be withdrawn by the emplOye on
leaving the service before retirement. nor can II
be taken in cash retirement but is To be used
only for the purchase of his annuity payable quar-
terly during life.
IL IS known that the President thoroughly ap-
proves of the plan proposed by the Keep
mission, and il Is understood that he will earnestly
recommend its adoption in his next annual message