Evening star., 1926-03-30
The Retirement Problem.

After 2 long delay attributable to
the compleyity Of the question. the
report Of the board of Government
actuaries on the civil service retire,
n1ent and disa hility fund has been sub.
nitted 10 Congress by the Secretary
or The Interior. and is now under
study by the committees of the House
and Senate. Whether legislation will
follow at this present session is now
prohlematical, for the case. as it is
presented to Congress, is one of un.
ienisble difficulty.
Secretary Work in his letter of
transmittal expressed the opinion that
"a definite legislative increase of an
ruities was due retired Government
servants" At the same time he diff
fers from the board on the score of
appropriations by the Government to
the retirement fund in advance of its
actual needs. There are now 3SS, ,622
Government employees under civil serv-
ice participating in the fund. with an
annual pay roll of $74S, 542 ,430. This
gives an annual ADDITION 70 tne Ietlit-
ment fund Of $lS,Sl3.5 $50. at the rate
Of 2i2 per cent of the salaries deduct
ed annually. The retired members
drawing annuities from the fund now
total 1859, the total of the amounts
paid to them being annually $6,36S,-
9S3 as of June 80, 1925. This is an
average OF slightly less than $545 a
year. The maximum is 1920 a year
IT would appear, therefore, that the
annual increment to the fund Is at
present at the rate of $12,444,577.
In contemplation of the future re.
uulrements of the retirement act. the
hoard estimates that 3.35 per cent of
the pay roll is required annually as a
normal contribution. The board Of
Rctuaries estimates that the employees
Of the active service now paving 2I1
per cent are contributing approximate
~ - per cent of the normal cost of
benefits. The immediate question is
whether the Government shall con.
tribute this remaining S5 per cent to
make the total 335 or the annual de.
ductions from the salaries of the ac.
tive employees shall be increased to
that point.
Secretary Work in his letter of
transmittal stresses the point that the
retirement fund was not intended to
he gratuity or charity to eX-
employees in want, but instead as hav-
ing been held in trust against final
separation from the service" He re.
CARDS it as unfortunate that the Gov.
ernment should eventually be called
Upon to contribute any part of the an
pujty, and suggests that salaries of
employees should be such as to war
rant sufficient monthly deductions TO
revoive the fund and TO avoid the ap.
pearance of beneficence.
When the retirement law was enact.
e6. annWties to be funded wholly
from deductions from salaries, it was
contemplated that the Government
ehould stand IS guarantor of the trust
The present difficulties show clearly
&hat a different hypothesis should
Q,ave prevailed. that the Government
should have directly contributed to
the first costs of retiring with an,
puities the employees then of an age
- warrant or permit separation from
ective service, who had paid nothing
the retirement fund. In other words.
Fhe Government should have assumed
Pa its own burden the cost of in.
ftiatirg the retirement system, with
the whole burden of subsequent re
sirements falling upon the fund Gre
eted by annual deductions.
This, however, was not done. The
present situation results. The fund is
not vet at a point of selfmaintenance
with a sufficient guarantee of amorti-
Fation for Withdrawals before retire
tnent and for the maintenance of an.
e1uities in the future.
Various plans have been proposed
THE present concern of those already
E,n the retired list is for their own
future. They are getting the barest
pittances now, averaging $545 a year
They have been forced out of active
service, many of them still competent
90 work efficiently. They are in need
end they are deserving. They were
Tetired at the time of the relatively
lowest point of Government compensa
Fion, and on the basis of that com
nensation. They should be given an
nuity commensurate with their needs
kowever the fund is financed for pres
ent or for future requirements