Evening star. [volume] (Washington, D.C.) 1854-1972, 1924-02-24
Increase the Annuities.

Increase the Annuities.
In the civil service retirement act
OF May %, 1920. it is provided that
each employee of the government
eligible for retirement under the terms
OF the act must pay into the Treasury
a sum equal to PIG per cent of his
basic salary, pay or compensation to
form the fund from which annuities
granted retired employees are paid.
These collections began under the law
on the iSt Of August. 1920. From that
date to June 80. 1923. the deductions
thus turned into a special retirement
fund in the Treasury have totaled
s40,69S,01S.36. The Secretary of the
Treasury has invested. of this sum
S25.2S5,670.15 in United States securi-
ties. which have earned interest and
profits amounting to $1,726,474.99.
Thus from the beginning Of the fund
to the LIST of July, 1928, the fund has
totaled S42,424,493.35.
Out of this fund in that same period
$17,042,334.37 has been expended on
account of annuities.
Thus in thirty-five months, from
August 1, 1920, to July l, 1923, the
government employees have put aside,
or have been required TO put aside to
maintain retirement fund, money at
the rate of s1.162.S00 from which the
retired employees have been paid at the
rate Of s4s6,923, leaving u monthly
hall iy,fa MI
other fund earnings, of s675,S87.
1t is evident that either the deduc.
tons from the pay of employees in &C.
tive service are at too high a rate, or
that the annuities allotted to retired
employees are at too low a rate. The
annuities run from $3.50 a year, under
the original act, to s720 a year. A new
class has been subsequently added to
the six groups first provided, that Of
charwomen, laborers. etc, and the
minimum in that group is ss6.40.
There is now pending in the House
a bill which increases the amount Of
anuuities in class A to IS per cent. in
class B to 20 per. cent. in class c to
70 per, cent. in class D to so per cent.
In class E to 80 per cent and in classes
F and G. to 100 per cent. Under these
increases the minimum annuity would
be s172.S0 and the maximum $1,1SS.
Under this new schedule it is figured
the fund would still show safe bal.
ance with a sufficient margin for in.
vestment.
This measure is founded in equity.
1t was never the intention of the pro-
ponents Of civil service retirement
that a great fund should be accum-
ulated beyond the needs of the system.
1t was. indeed. conceived that the
government should contribute to this
fund. but Congress adopted the plan
OF putting the whole cost on the EN-.
ployes at a rate which was in a meas
ure experimental, and which expert.
ence has proved was too high to pro.
vide for the scale Of annuities adopted.
1t cannot be said that the an.
nuities granted under the civil serv-
ice retirement act are eXtravagant or
generous. Certainly the maximum Of
$3.50 year paid to an employee Of
thirty years of service is, not liberal.
And it must be borne in mind that
every dollar thus paid has come out
of the pockets Of the employees them
selves, that the United States has not
spent one dollar to date in maintain.
ing this fund or in paying the an.
nuities.
The retired employees Of the govern.
ment are now asking for an increase
Of dividend from their insurance fund.
Inasmuch as the expenditures from
the fund are only about 43 per cent of
the total deductions from the pay en-.
velopes it would seem to be only fair
to grant their request. No one will
suffer. and the fund will be as secure
as all the prospective obligations re.
auire. And the annuitants will inciden.
tally he getting something a little
closer to a living pittance after their
many years Of service for the govern.
ment.