Social Security is paying roughly $50 million a year too much to people who collect state pensions but fail to declare that income, according to the system’s inspector general.It is odd that I do not remember this report from Social Security's Office of Inspector General nor can I find it online. Was this leaked to Biggs before it was officially released? While not insignificant, in Social Security terms, this is small potatoes.The overpayments go to retirees who have held state jobs and also worked in the private sector — teachers who worked on their summer breaks, for instance, or police officers who retired young enough to form their own companies.
If the workers do not declare their state pension income, they appear to be low lifetime earners in the Social Security system. ...
“This is somebody else’s money they’re playing with,” said Andrew G. Biggs, a former deputy commissioner for Social Security, now an economist with the American Enterprise Institute. “The people who are in the Social Security system who don’t get good state pensions, this is taking money away from them.”
Jul 21, 2010
Wonder How This Story Got In The Times
From the New York Times:
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3 comments:
The Times article states that the latest audit was done in September 2008. Why it is in the press now is interesting but nothing was leaked. Rather the data is 2 years old.
The President's budget submission every year for the last 4 or 5 years includes a requirement that state pension plans report the annuity payments to SSA (via a 1099 I presume). OMB has scored the savings (in increased application of the WEP and GPO offset provisions) at close to $2.5 - 3 billion over 5 years. Meaning, 50 to 60 million a year goes to state pensioners who should be getting hit by the offset. So, yeah, this is not news at all.
Biggs was formerly the Dep. Commissioner of SS. No friend of the existing system and is a big advocate for privatization. The SF-1099 goes to IRS as well for income tax reporting purposes. SSA has several such reporting agreements with other state agencies for large personal injury car insurance settlements, WC settlements, and the like. There is a specific question on the DIB and RIB retirement applications regarding work for any governmental agency. So, people are withholding information. Not much you can do about this. Fraud is an intent crime and is hard to prove, but it is easy to collect overpayments via deductions from benefits. So, as A#1 and #2 say, this not a BFD.
Biggs was one of the people who were out there early hollering doom and gloom because of the decrease in current FICA revenues. Duh. There's a recession going on, dude. I have the impression that he goes out of his way to exaggerate any bad news he can find or in this case, dig up from the past to make the program look bad. Just sayin'. Nancy Ortiz
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