President Joe Biden is set to sign a new measure into law that will impact nearly 3 million current and former public employees who receive pensions from their time in public service roles such as teachers, firefighters, and police officers. The Social Security Fairness Act aims to rectify a long-standing disparity by rescinding two provisions - the Windfall Elimination Provision and the Government Pension Offset - that have limited Social Security benefits for individuals receiving retirement payments from other sources.
According to estimates, around 1% of all Social Security beneficiaries were affected by the Government Pension Offset, while about 3% were impacted by the Windfall Elimination Provision. The elimination of these provisions is expected to increase monthly payments for affected beneficiaries by an average of $360 and $700, respectively, by December 2025.
The change in payments will be effective from January 2024 onwards, with the Social Security Administration required to make back-dated payments to those affected. The adjustment process for primary insurance amounts is yet to be clarified.
Advocates, including the International Association of Fire Fighters and the American Federation of State, County and Municipal Employees, have praised the new law for correcting a decades-old injustice and providing financial relief to public service workers. The National Education Association also hailed the legislation as a historic victory that will benefit educators, first responders, and postal workers.
While some Republicans supported the bill, others expressed concerns about the long-term sustainability of the changes. The new law will add administrative burdens to the Social Security Administration, which is already operating with reduced staffing levels.
With the Social Security program facing insolvency by 2035, the enactment of the Social Security Fairness Act is expected to advance the program's insolvency date by approximately six months. The future of Social Security remains a key political issue, impacting millions of beneficiaries across the country.
