The Senate could soon vote on a bill to change certain Social Security regulations

During the final business days of this congressional session, the Senate is expected to vote on a bill that would change certain Social Security rules.

The bill – the Social Security Fairness Act – would repeal provisions that cut Social Security benefits for some people who also receive retirement income from public sector jobs.

On November 12, the House of Representatives passed the bill with support from members of both parties.

Now it’s up to the Senate to pass the bill. The calendar is packed and also includes a deadline to prevent a federal government shutdown.

The Social Security Fairness Act would eliminate certain rules that affect some public retirees – the Windfall Elimination Provision (WEP) and the Government Pension Offset (GPO).

The WEP reduces Social Security benefits for individuals who also receive income from unfunded pensions – payments from employers who have not withheld Social Security taxes from their salaries.

The GPO adjusts Social Security spousal or widower benefits for individuals receiving income from unfunded pensions.

Both rules have been in effect for decades.

The WEP was enacted in 1983 to ensure that workers with unfunded pensions would not receive reimbursement as if they were long-term low earners. Social Security has a progressive benefit formula, meaning low earners receive a higher rate of income replacement.

Established in 1977, the Government Pension Offset reduces Social Security benefits for spouses and surviving spouses who receive a pension based on their own government employment that is not subject to Social Security payroll taxes and Social Security spousal benefits based on their spouse’s work experience.

According to the Social Security Administration, 2.01 million people – or 3.1% of all Social Security recipients – were affected by the WEP in 2022.

According to the Social Security Administration, the GPO applied to nearly 735,000 beneficiaries as of 2022. According to previous Congressional Research Service estimates, this rule affects about 1% of all benefit recipients.

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Of course, WEP and GPO do not apply to everyone.

In particular, the WEP does not affect beneficiaries who have received significant social security income for 30 or more years. According to the Social Security Administration, the rule also does not apply to people who fall into other specific categories: federal employees first hired after December 31, 1983; Employees of non-profit organizations who were exempt from social security obligations as of December 31, 1983; Persons who only receive retirement income for employment with the railway; and those whose only work that did not incur Social Security taxes occurred before 1957.

The GPO generally does not apply to spouses or surviving spouses who receive public pensions that are not based on their income, or who are employees of the federal, state, or local government and whose pension arose from employment in which they paid Social Security taxes.

The Social Security Administration provides a tool on its website to help you estimate how a pension may affect Social Security benefits.

Last week, Senate Majority Leader Chuck Schumer, D-N.Y., said he would put the Social Security Fairness Act up for a vote.

The House bill was introduced by Reps. Abigail Spanberger, D-Va., and Garret Graves, R-La. The Senate version was co-led by Sens. Sherrod Brown, D-Ohio, and Susan Collins, R-Maine.

Schumer has since filed a notice saying he intends to hold a final vote on the proposal this week. If the cloture vote has the required 60 votes, the rest of the process could move forward “fairly quickly,” said Maria Freese, senior legislative representative at the National Committee to Preserve Social Security and Medicare.

“The big vote is usually the motion to proceed,” Freese said. “If they get 60 points for that, they should be in pretty good shape to make it this year.”

A Senate version of the bill has 62 co-sponsors. However, there is no guarantee the bill will receive 62 votes, Freese said. Two co-sponsors — Sens. Bob Menendez, D-N.J., and Dianne Feinstein, D-Calif. – are no longer in office. Their successors — Sens. Andy Kim, D-N.J., and Adam Schiff, D-Calif. – Both supported the bill when they were members of the House of Representatives.

Another co-sponsor — Vice President-elect and current Sen. JD Vance, R-Ohio — may not be present to vote, Freese said.

Once a motion to proceed passes, changes to the bill could be proposed if Senate leadership allows, said Emerson Sprick, deputy director for economic policy at the Bipartisan Policy Center. These changes could aim to replace a complete repeal of the rules with another solution or to offset the costs of the benefit increases.

“It was not the ideal process for making a significant change to Social Security,” Sprick said.

The House bill’s co-sponsors had to file a discharge motion to bring it up for a vote, meaning it didn’t make it through committees. Likewise, lawmakers in the Senate have not had the opportunity to learn about the disadvantages of completely repealing the rules and the alternatives, Sprick said.

“A complete repeal will make the program less fair and more financially uncertain,” Sprick said.

Freese said the change could take time to implement for nearly 3 million Social Security recipients.

The Social Security Administration, already suffering from staffing shortages, could lose another 2,000 employees if it doesn’t receive the additional funding it requested in the continuing resolution that Congress is also working to finalize, she said.

Additionally, it would take some time for agency staff to reprogram their computers and then begin sending out the new benefit payment amounts.

If the change doesn’t take effect immediately, the Social Security Administration will likely send catch-up checks or deposits retroactively to make up the difference, Freese said.

The Social Security Fairness Act has received strong support from groups representing firefighters, police officers, teachers and other government workers who would be affected by repeal of these rules.

But policy experts have generally opposed the change, saying lifting the rules would alter the progressive nature of the program.

It would also move the expected date for depletion of the Social Security trust fund to six months earlier and cost about $196 billion over a decade, according to the Committee for a Responsible Federal Budget.

Even without this change, the trust fund that the program relies on to pay out retirement benefits could be depleted in nine years, the program’s trustees predicted.

“We are hurtling toward our own financial demise,” Maya MacGuineas, president of the Committee for a Responsible Federal Budget, said in a statement criticizing efforts to repeal the WEP and GPO rules.

If the bill is approved, it would also impact future reform efforts. But the problems Social Security now faces are bigger than just paying for the WEP and GPO repeal, Freese said.

“As you get closer to the exhaustion date, it becomes more difficult because you end up having less flexibility in what you can do for the program to make it solvent,” Freese said. “You have less time to implement the changes.”