Evening star., 1921-12-18
ASK -FOUR CHANGES
| IN RETIREMENT ACT
FOR j. S. EMPLOYEES
Recommendations Made to
Congress in Report of
Board of Actuaries.
MORE EQUITABLE BASIS
FOR AGE LIMITS URGED
Advocate Benefits Based on Same
Salary as That to Which Con-
tributions Are Paid.

four important changes in the act
Tor the retirement of employees in
the classified service of the govern
ment are made in the first report of
the board of actuaries authorized in
the law itself, which was sent to
congress last night. The report was
accompanied by letters of transmit
tai from E. c. Finney. acting Secre-
tary OF the Interior, and Washington
Gardner, commissioner of pensions.
Mr.. Finney noted in his letter that
this transmittal is not to be con-
strued as departmental approval
OF the recommendations of the board
Recommendations Made.
The recommendations are:
The benefits should be based on
the same salary as that to which
the contributions are paid, or they
should be related directly to the
amount of the contributions.
The ages fixed for retirement on
account of age should be adjusted SO
that the only distinction made be-
| tween groups would be that required
| on the basis of the service expert
ence, in order to make the normal
cost the same for all occupational
groups.
The section of the law providing
for increases in annuities on COM
pletion of term of service which are
! multiples of three should be re-
| pealed.
The law should be amended to pro-
vide for certain safeguards on dis
ability retirements; to give author
| ity to member to nominate a bene-
| iciary; to receive the amount of his
accumulated contributions in the
event of his death; to require the
head Of each department or inde-
| pendent bureau to furnish annually
the information necessary concern
ing the employees under his super
vision for the use of the commits
| sioner OF pensions.
Provision for Actaaries.
The civil service retirement act
| provides for a board of three ac-
| tuaries, one of whom shall be a gov
] ernment actuary, and the duty Of
this board is to report annually upon
| the actual operations of the act. Au-
| thority is given to the board to rec
ommend such changes as may be
deemed necessary to protect the pub
lie interest and maintain the system
upon a sound financial basis.
The civil service retirement and
disability fund of the United States
was established under act of Con-
| sress May %, 1920. Under the pro-
| visions of the act are included all
| employees of the classified civil SER
vice of the United States. representing
| one of the largest groups of en-
ployes ever to be covered by
single retirement fund.
The board of actuaries appointed
| in 1921 consists of George b. Buck.
| consulting actuary of New York
city; with J. d. Maddrill and Joseph
S. Mccoy, government actuary in the
| Treasury Department.
| Their report first gives a statement
| of the approximate present and pro-
| spective assets and liabilities of the
| fund as determined by an actuarial
| valuation. This shows the grand
! total of liabilities as of June 80, 1921.
as $43s,369,5S4 and the grand total
assets the same, made up of funds
| in hand, S9.672,S42: total of contri-
buttons of employees of 2ls per cent
| of their salary, $126,326.449; and ap-
| propriations required of the govern
ment, s3o2,370,293.
Records Declared Necessity.
| Following this statement, are
recommendation made by the board
of actuaries in accordance with the
| act. The report also includes ques-
| tions which the commissioner OF pen
sions has asked the board of act
| uaries regarding the cost of certain
proposed changes in the provisions
of the act governing the operation
of the fund, with the answers made
by the board.
Emphasis is laid in the report
| unon the businesslike necessity
| of establishing accounts In the
Treasury whcih will show liabilities
of the fund and upon the necessity
1
ALI active participants.
| In explaining the reasons for the
first change recommended to Congress
that the benefits should be based on
the same salary as that on which the
contributions are based. the board of
actuaries points out that at the pres
ent time employees contribute 21a per
cent of their salaries without any
limit as to the amount of salary upon
which contributions shall be made.
whereas the amount of annuity which
they receive is definitely limited to
final salary of $1,000. The higher
salaried employees. therefore. contrib
ute a greater portion Of their benz
fits than do the lower salaried en-
Moves. A table is included in the
report to show the extent Of the un-
fairness as between employees result
ling from this provision.
Example Cited.
It shows, for example. that a clerk
entering the service at the age of
twenty-five on a salary of $3.50 would
linaily. after having experienced nor
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