President's FY 2009 Budget

The President's recommended budget for the Social Security Administration for Fiscal Year (FY) 2009, which begins on October 1, 2008, is out. Before talking about this budget, let me emphasize that Social Security's budget is a complicated matter and I am no budget expert. All I can give you is my understanding at this point. Readers can study the original documents for themselves.

The President's recommended budget shows the Social Security's administrative budget for FY 2009 being $10.386 billion, which is $596 million over the current fiscal year, a 6.05% increase. However, unlike the current fiscal year, $504 million is allocated for "program intergity", which means making sure that all the money being paid is being paid properly, rather than making sure that everyone who should be paid is being paid. Certainly, money will be spent in this fiscal year on "program integrity", but there is no requirement that a certain amount be spent on program integrity and it is unlikely to be anywhere near $504 million. Basically,the President's recommended budget appears to me to be close to a budget freeze. I doubt that there is any money in this budget for significant increased hiring.

I should make it clear that the President's leverage on the FY 2009 budget is limited. Congress can, and probably will, pass continuing funding resolutions until Bush leaves the White House and then deal with his successor. Democrats in Congress are certain to declare this budget "dead on arrival." The top Republican on the Senate budget committee has already declared this budget "an academic exercise" and said it lacked credibility, according to Reuters.

Here are a few items included in the budget:

• Continues ambitious initiatives to reduce the number of disability appeals that are awaiting a decision from an Administrative Law Judge.

• Provides funding for projects that identify those cases most likely to be allowed so that severely ill applicants can begin receiving benefits on an expedited basis.

• Increases the capacity to process disability appeals by hiring additional Administrative Law Judges and support staff.

• Boosts the overall productivity of hearings and targets overtime to critical areas. ...

• Proposes legislation to synchronize the treatment of retroactive DI payments with Old-Age and Survivors Insurance payments, and to make additional modifications to the distribution of other retroactive payments.

• Proposes legislation to encourage children to stay in school by lowering to 16 the age at which full-time school attendance is a condition of entitlement for Social Security child’s benefits. ...

• Proposes to replace the existing complicated offset with a uniform offset for DI beneficiaries also receiving workers’ compensation. The proposal would limit the length of the offset to not more than five years.

The Detailed Budget Estimates supplement (page 1123) indicates that the proposal to "synchronize the treatment of retroactive DI payments with Old-Age and Survivors Insurance payments" means that the President wishes to reduce retroactive disability insurance benefits from twelve months to six months. I have never heard the word "synchronize" used in this way before.