What about the WEP?

What about the WEP?
Weekly Report for October 8, 2021

October 8, 2021

By, Shawn Duhamel

On Wednesday we went to press with the November edition of the Voice, which should begin to arrive in member’s mailboxes by end of the week of October 18th. In this edition we focus heavily on the pension cost-of-living -adjustment, making a strong case as to why our retirees deserve improved COLA benefits and how the retirement systems can fund the increase. The data and facts are clearly spelled out to help pass these improvements for the coming FY23.

We have also placed a great deal of focus on reporting on retiree health insurance benefits at both the local and state levels. As you may have heard us say, the decisions made over the course of the coming year will prove to be critical in terms of the quality and affordability of retiree health plans for the foreseeable future.

Watch today's video report here!

In the coming weeks, I will have more to share with you on these issues. Today I would like to provide you with an update on where things now stand with our national effort to reform the Social Security Windfall Elimination Provision (WEP) law. A good portion of what you are about to read will also appear in the November Voice. Given the urgency of this ongoing issue, it is important for us to keep our members well informed. 

Full discloser, this is a long but very important email. If you are impacted by the WEP law, please read through to the end and also watch my video. It is very important that you stay well informed, as well as know how you can help us win this fight!

There is not a day that goes by (including most weekends) when we do not receive a call, email, letter, or social media post containing the question “What about the WEP?”. These are never easy conversations to have. Retirees are frustrated and angry – rightly so! You want relief from the WEP, yet results are hard to come by.

As it now stands, at least 74,000 Massachusetts residents are impacted by the WEP. By impacted, I mean that they are public retirees who have had their own personal Social Security benefit reduced by the WEP law. This number grows each day as new retirees apply for Social Security. Across the country roughly 2 million public retirees have already had their Social Security reduced by the WEP. Millions of current active employees will one day be harmed by this law, unless Congress acts. 

There are now two different approaches pending before Congress addressing WEP. One approach would fully repeal both the WEP and its companion law the Government Pension Offset (GPO). Mass Retireeshad supported and actively fought for fully repeal for nearly 30 years, but we no longer believe it to be a viable option. As long as the US Senate remains closely divided, with a 60-vote majority required to pass legislation, full repeal cannot pass.

However, what we do believe to be possible is the passage of compromise legislation that would reform the WEP. This is the approach taken by Congressman Richard Neal within his proposal H.R. 2337. If passed into law, the bill would restore up to $150 a month in Social Security benefits lost to the WEP, while also creating a new Social Security formula for future retirees. 

While Neal’s bill has been endorsed by more than 50 national retiree and public employee organizations and has been cosponsored by 178 House Democrats (including all 9 MA members of Congress), H.R. 2337 currently does not have Republican support. The reason appears to be largely due to a difference of opinion over how the bill treats future retirees. 

Under Neal’s proposal, future retirees would have their Social Security benefit calculated using both the old and new formulas, then receive the greater of the two. This clause, which would exist in perpetuity, was created to prevent any inadvertent reduction in benefits from occurring. The Democrat position is that the hold-harmless clause should continue to exist indefinitely, while Republicans would prefer that it sunset. 

WEP reform legislation filed by Congressman Kevin Brady (R-TX) in 2019 carried a 40-year sunset clause, designed to protect current workers from an unfair change in the Social Security rules. At that time Brady’s bill also contained a $100 rebate – rather than the $150 benefit offered by Neal’s proposal. 

Another difference of opinion could also exist over calculating the long-term cost of WEP reform, as well as how the change in benefits will be paid for. However, we believe these differences to be minor and that over time, the changes in Social Security would pay for themselves.

Given the closely divided House and the 50-50 Senate, where the filibuster remains, we believe that only a bipartisan proposal that has the full support of both Mr. Neal and Mr. Brady can pass both chambers of Congress. Thankfully a strong working relationship and mutual respect exist between Brady and Neal, leading us to believe that a WEP reform deal will get done.

Another important factor is the legislative process itself, in terms of what form or in which vehicle a WEP reform proposal could move forward. Over the past two years the reconciliation process has been used to pass most, if not all, major pieces of legislation due to the need to overcome threats of a Senate filibuster. As you might know, the filibuster takes a 60-vote supermajority to break.

Congressional rules prohibit the inclusion of any proposal related to Social Security from bills passed through reconciliation. This prevents WEP reform from being included within these larger recent legislative acts. 

Of course all of this procedural maneuvering is inside baseball. What is most important to our members is that WEP remains unresolved.

This week Frank Valeri, Nancy McGovern, Tom Bonarrigo, Tom Lussier, and I spoke with Congressman Neal’s senior staff about what we can do to help move WEP reform forward, as we have regularly done for the better part of the past several years. We also conveyed to them the deep frustration and outright anger of our members toward what is seen as inaction on the issue.

Yesterday afternoon, I had the opportunity to also speak with Mr. Brady’s staff and delivered the same message.

The message is simple, we must find a way to bring people together and compromise on the remaining differences of opinion – which we believe to be quite small. The hardest work has been done. The majority of the House is on record agreeing that the current WEP law is unfair and should be reformed. Where they differ is on the fine details of what that reform can and should look like.

Working with our national partners, which includes retiree organizations from the other WEP impacted states, we will continue to advocate for a reasonable compromise that can result in a bill passing both the House and US Senate, then on to President Biden this Congressional Session. Again, we collectively represent some 2 million retirees spread across the country. 

This is where you come in. We need your continued help if we are to be successful in getting a bill passed. We need our members to keep in contact with your local member of Congress. Keep the pressure on that member to help get a deal done and pass WEP reform into law. We need as many Republicans and Democrats actively supporting H.R.2337 as we can. 

By now, I think you know just how much this issue means to all of us here at Mass Retirees. Reforming the WEP is deeply personal to me as well. None of us is going to stop fighting for you, regardless of how frustrated we become or how long it may take to win.

All we ask is that you stay in this fight alongside us.

Maintaining contact with your member of Congress is critical. Click here to find the phone number for the local office in your community or to send an email / letter. Ask them to not only support WEP reform and H.R. 2337, but to also make this issue a personal priority by working craft a compromise and pass a bill into law.

Thank you for the support you continue to give us.

 

 

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