On December 20, 2024, Congress passed the bipartisan Social Security Fairness Act, co-sponsored by U.S. Senator Maria Cantwell, aimed at increasing Social Security benefits for over 40,000 public sector workers in Washington. This legislation seeks to repeal the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO), which previously reduced benefits for public servants such as firefighters and teachers. The WEP affects those with civil service pensions and Social Security contributions, while the GPO impacts spousal benefits for individuals with government pensions not covered by Social Security. The act is set to take effect immediately upon President Biden's signature, with retroactive payments available in 2024 [62e260e2].
The passage of this bill comes at a critical time when the Social Security Trust Fund is projected to become insolvent by 2034, raising concerns about the long-term sustainability of the program. The Social Security system has faced significant challenges in recent years, receiving a C+ grade in the 2024 Mercer CFA Institute Global Pension Index, ranking 29th out of 48 countries. This marks the 15th consecutive year that the U.S. has never scored above a C+, with a score of 60.4 in 2024, down from 63 in 2023 [626cdf6b].
A recent survey indicated that 72% of non-retired Americans are concerned they won’t receive Social Security benefits upon reaching retirement age. This concern is particularly pronounced among younger generations, with only 48% of millennials and 46% of Gen Zers expecting to rely on Social Security for necessary expenses. In contrast, 77% of current retirees rely on Social Security, and 69% of baby boomers expect to depend on it [69e4b929].
While the recent bipartisan bill aims to provide immediate relief to government employees, critics, including Sen. Rand Paul (R-Ky.) and Rep. Chip Roy (R-Texas), argue that this legislation could worsen the federal budget deficit, which reached $624 billion in the first three months of fiscal year 2025 [06aaa1fa]. As discussions continue around fiscal policy and budget deficits, the implications of this new legislation will be closely monitored. Experts warn that the projected depletion of the Social Security fund by 2033 could lead to beneficiaries seeing their checks shrink by 23%. Additionally, Medicare is expected to cover only 89% of payments by 2031, further complicating the landscape for future retirees [566d6c53].