Public Workers Face Delays in Social Security Payouts Despite New Law
Among the millions impacted by the Windfall Elimination Provision and the Government Pension Offset, which took away some Social Security benefits for people who were also receiving a public pension, is retired Connecticut school teacher Bill Callahan, 67. Social Security Fairness Act signed into law on January 5, 2024, does away with these provisions and promises higher benefits for nearly three million retirees.
The SSA admits, however that the retroactive effective date for the Act is January 2024 and affirms it does not have adequate funds or staff to speed up the changes. “Although SSA is assisting some benefit recipients already, based on current SSA budgets, it will take over a year to update benefits and pay all retroactive benefits,” the agency said.
The impact will be different in each case; some retirees can expect a minor boost, while others will see checks increase by over $1,000 per month. The SSA must recalculate the benefits from the past time of reduction, taking into account COLAs and spousal benefits in its accounting effort.
Congress passed the law but never appropriated any money to implement it. The SSA is under a hiring freeze since November 2024 and is also severely understaffed.
“Ability of SSA to implement the law on time without adverse impact on daily customer service will depend on the funding,” said the agency. In addition to delayed payments to the three million retirees, it could also hinder services for 68 million other Social Security recipients.
While the Act corrects a long-standing issue for many public workers, the Committee for a Responsible Federal Budget (CRFB) warns it will cost $196 billion over the next decade and accelerate Social Security’s insolvency by approximately six months. The original WEP and GPO provisions, introduced in 1983, aimed to prevent overpayments to retirees who had non-covered government pensions. Policy experts argue that eliminating these rules could strain the system further.
Affected retirees will have to wait while the SSA processes adjustments, and all Social Security beneficiaries may face longer wait times for service as the agency prioritizes recalculating benefits.
Senate Majority Leader Chuck Schumer (D-NY) has promised to force a vote on additional funding, but until then, the three million public sector retirees must wait for the payments they were promised.
