Fed retirement changes a ‘possibility’ in Obama deficit plan

Budget

Fed retirement changes a ‘possibility’ in Obama deficit plan

President Obama\'s deficit reduction plan speech on Wednesday did not address how these cuts would affect federal pay and benefits, but one administration official...

Federal News Network Staff

April 15, 2011 1:28 pm

< a min read

By Jolie Lee
Federal News Radio

President Obama’s laid out a plan this week that would lower the deficit by $4 trillion over the next 12 years. His speech on Wednesday did not address how these cuts would affect federal pay and benefits, but one administration official told Federal News Radio that changes to federal retirement benefits were still possible.

“Yes, it is accurate that while not proposed yesterday, it is a possibility,” the official said in an email on Thursday to Federal News Radio.

It’s unclear now whether President Obama’s plan will include recommendations by the bipartisan deficit reduction commission co-chaired by Erskine Bowles and Alan Simpson. The commission recommended freezing federal pay for three years, reducing the federal workforce by 10 percent, and changing the retirement formula from a high-three to a high-five calculation.