Evening star., 1924-02-25
Deductions and Annuities.

The civil service retirement act
created two parties to the procedure
Of providing for the compensation of
veterans Of the public service who
reach a certain age and are relieved
from active duty. These are the clerks
in active service who contribute to
the fund by a deduction Of 2js per
: cent Of their pay in monthly install.
: mentS, and those who pass into re-
tirement and draw their annuities
from that fund. The government is
merely II trustee, assuming no finau-
cia' responsibility save as custodian
, and administrator. The government,
however. makes the terms of the con-
tract and the rules for it's enforce.
, ment. 1t is now asked to change the
rules to grant larger and slightly
more adequate compensation for an.
nuity to the retired employees out of
the fund. which proves to have been
more than twice as large as necessary.
If the annuities prescribed under
the organic act of the retirement sys-
tenn are as high as should be paid then
the amount of deduction from the pay
OF the active employees is too high. 1t
is unfair to take as much as 21s per
cent of the pay of the active workers
in order 10 maintain a fund from
which they. when they do retire, can
gain only a pittance that calls for only
Il little more than 40 per cent Of the
fund,
Nobody can fairly claim that the an.
nuities paid to the retired employees
are high. They range from $3.50 to
S720. Even the highest figure is d
pitifully small amount. It does not suf.
fee for actual maintenance in the
case of veteran worker and his wife
There is no ''liberality" in a system
which forcibly takes 21a per cent out
OF the salaries of the active employees
in order to pay these insignificant
sums to the retired people and mean.
while pile up surplus OF 90 per cent
in the Treasury. The United States
has the use of this surplus money. II
has the authority, through the Secre-
tary OF the Treasury, to invest it in
its own securities. II is not held In a
strictly segregated fund. 1t passes
into the general funds, and Is simply
segregated on the books as liability
in trusteeship. 1t is unquestionably
to the interest OF the government to
keep that surplus large by continuing
the 2Is per cent deduction while pay
ing the inadequate annuities.
But this matter is not to be viewed
from the standpoint Of the govern.
ment's interest. 1t has no rights in
the premises as against those of the
public service workers, active and re.
tired, whose affairs 1t Is managing. II
must look at the matter solely from
trustees point of view. Is it neces-
sary to make so large deduction Of
pay in order to make so small a pay.
ment? Is it necessary to keep the an
nuity so low while the fund is &C.
cumulating at the rate of millions Of
dollars annually?
Congress is now asked to answer
these questions. Proposals are pend.
ing before it for a change in the scale
Of the annuities. They must be con.
sidered or the United States govern.
ment will be In the position Of a
profiteer, an unjust steward After
nearly four years of operation It Is
plain that the percentages in the or.
ganic retirement act are wrong. They
should be changed now to give the
annuitants something closer to a liv.
ing compensation after their years of
faithful service.