Summary: Pursuant to a congressional request, GAO provided information on the proposal to change the congressional retirement system, focusing on: (1) the cost of congressional retirement benefits; (2) the potential savings from the proposal; (3) how private sector retirement systems compare with the congressional retirement system; and (4) the extent to which private sector employers are replacing defined benefit pension plans with defined contribution plans. GAO noted that: (1) the estimated cost of providing future retirement benefits to 1994 Congressional members would total $14,327,224; (2) over a 5-year period, the cost of providing retirement benefits would total $71.5 million; (3) if the proposal were enacted, it would significantly reduce the cost of Member retirement programs; (4) the cost of providing retirement benefits to 1994 Congressional staff members would total $116.5 million; (5) although federal employees receive greater benefit amounts under the Civil Service Retirement System than nonfederal employees before age 62, they receive smaller amounts after age 62 and older when social security benefits are available to nonfederal employees; and (6) the private sector does not appear to be moving toward replacing defined benefit plans with defined contribution plans.
