President Joe Biden signed the Social Security Fairness Act into law over the weekend. The new law will increase Social Security benefits for millions of American retirees. It eliminates two provisions that had reduced benefits for certain public sector workers.
The Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO) had reduced benefits for retirees who received pension income. This impacted public employees like police officers, firefighters, nurses, postal workers, public school teachers, and other government employees. “The bill I’m signing today is about a simple proposition: Americans who have worked hard all their lives to earn an honest living should be able to retire with economic security and dignity,” said President Biden.
He estimated that the law will lead to an average monthly increase of $360 for certain public employees, their spouses, and survivors. More than 2.5 million Americans are expected to receive a lump sum payment to compensate for last year’s missed benefits. The legislation passed the House of Representatives in November and was approved by the Senate with a 70-26 vote last month.
Biden increases benefits for retirees
The estimated cost of the bill is $196 billion over the next ten years. Public sector employees eligible for the improved benefits will include anyone employed by the government, a government-funded organization, or a school.
Senate Majority Leader Chuck Schumer, D-N.Y., called the bill “a great gift for our retired firefighters, police officers, postal workers, teachers, and others.”
However, not everyone supports the legislation. Opponents like Sen. Chuck Grassley, R-Iowa, argue that the bill could create unfair benefit calculations.
Some critics warn that it could jeopardize the overall Social Security fund, which is reportedly less than ten years from potential insolvency. Sen. Thom Tillis, R-N.C., voiced concerns that the Fairness Act might accelerate this issue. The Social Security Administration (SSA) is currently assessing how to implement the new law and will provide further information soon.
Those who have previously filed for Social Security benefits don’t need to take any action except to update their mailing and direct deposit information if necessary. For those who haven’t yet filed and are interested, the SSA recommends scheduling an appointment.
