How Social Security Bill Could Change 2025 Benefits
The House of Representatives has passed legislation that could see Social Security benefits change for millions of recipients—but it is still awaiting Senate approval.
The Social Security Fairness Act was passed with considerable bipartisan support by the House on November 12, and will now head to the Senate. The bill would repeal two federal policies that currently limit Social Security payouts for around 2.8 million Americans who work in federal, state and local jobs.
The bill attracted headlines earlier this fall when its House sponsors, Virginia Democrat Abigail Spanberger and Louisiana Republican Garret Graves, succeeded in filing a discharge petition—a method of taking a bill to the House floor for consideration without a report from the relevant committee—to force a vote on the bill.
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A stock image of a Social Security card with U.S. dollar bills. The bill repeals provisions that reduce Social Security benefits for individuals who receive other benefits, such as a pension from a state or local government.
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What Is the Social Security Fairness Act?
If it becomes law, the Social Security Fairness Act would eliminate two provisions: the Windfall Elimination Provision and the Government Pension Offset.
The WEP reduces Social Security benefits for individuals who receive pensions from public sector jobs, such as state and federal employees, that are or were not required to make Social Security payroll tax contributions, even if they contributed to Social Security through other jobs in their career and are otherwise eligible for benefits. This provision currently affects approximately 2 million beneficiaries.
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The GPO decreases spousal or survivor benefits for retired federal, state, and local government workers who did not pay into Social Security through payroll taxes. This rule impacts nearly 800,000 retirees.
To summarize, the bill would:
- Repeal provisions that reduce Social Security benefits for individuals who receive other benefits, such as a pension from a state or local government.
- Eliminates the government pension offset, which can reduce Social Security benefits for spouses, widows, and widowers who also receive government pensions of their own.
- Eliminates the windfall elimination provision, which in some instances reduces Social Security benefits for individuals who also receive a pension or disability benefit from an employer that did not withhold Social Security taxes.
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How Would the Bill Change Social Security Benefits?
If the bill does pass the Senate and is signed by the president, it would mean a rise in benefits for all those who are currently subject to the WEP and GPO. A 2020 study by the Urban Institute revealed that eliminating both provisions would enhance benefits for 4.5 percent of all beneficiaries by 2025, with an average annual increase of approximately $7,300. However, it would add some $195 billion to federal deficits over 10 years, the Congressional Budget Office has estimated.
A date for a Senate vote has not yet been scheduled. If it does eventually pass, it will apply to all benefits payable after December 2023.
Spanberger and Graves, along with Senate sponsors, Democrat Sherrod Brown and Republican Susan Collins, urged Senate Majority Leader Chuck Schumer and Minority Leader Mitch McConnell to bring the bill to a vote in a letter published this week. They said that Americans who are subject to the provisions “are being punished for supporting and protecting our neighbors and families, educating our children, providing healthcare to our Veterans, delivering our mail, and more.”
Newsweek has contacted the offices of Schumer and McConnell for comment via email outside of regular working hours.