"...The Obama administration and lawmakers from both parties generally favor increasing the amount government workers contribute to their pensions. Federal employee unions, including the American Federation of Government Employees and the National Treasury Employees Union, are poised to do battle to protect retirement benefits and pay as the lame-duck session gets under way and the new Congress convenes in January 2013. During a conference call with reporters Wednesday morning, AFGE President J. David Cox argued against increasing feds’ pension contributions in part by claiming that “federal employee retirement is fully funded.” In other words, why change a system that’s working fine as it is and not breaking the bank? It’s an argument others have made before. But what does it mean?
Most federal workers fall under the Federal Employees Retirement System or the Civil Service Retirement System; both contain a mix of employee- and employer-financed contributions to the Civil Service Retirement and Disability Fund. FERS annuities are fully funded by the sum of employee and employer contributions and interest earned by the Treasury bonds held by the CSRDF, but that is not the case with CSRS retirement benefits..."
