Summary: GAO presented its views on the proposed Civil Service Supplemental Retirement System, which combines social security, a defined benefit pension plan, and a thrift plan. This approach and the provisions of the thrift plan portion of the proposed program are consistent with prevailing provisions in the private sector; however, other aspects of the plan differ from private sector programs. GAO found that the proposed plan: (1) is about one-third more costly than the typical private sector retirement program; (2) will offer federal employees unreduced benefits at an earlier age than private sector employees; (3) uses a shorter average salary period for benefit computation purposes than do private sector plans; (4) adds plan benefits to social security while private sector plans use a benefit-leveling supplement to social security benefits; (5) calls for higher cost-of-living adjustments that those available in private sector plans; (6) vests earlier than typical private sector plans; (7) requires employee contributions which few private sector plans require; (8) contains a disability program while most private sector programs have separate disability plans; and (9) has different survivor benefits than private sector plans. Finally, while GAO believes that funding provisions of the proposal are sound, the same funding requirements do not apply to the current civil service retirement system.
