Sen. Carper Statement on U.S. Postal Service Decision to Suspend Federal Employees Retirement Systems Payments
Jun 22 2011
WASHINGTON – Today, Sen. Tom Carper (D-Del.), chairman of the subcommittee with jurisdiction over the U.S. Postal Service, released the following statement reacting to the Postal Service's decision to suspend its Federal Employees Retirement Systems (FERS) payments:
"Today's drastic action by the U.S. Postal Service underscores the urgent need for Congress and the Administration to act quickly to address the serious financial problems facing the Postal Service. In essence, this is the canary in the coal mine moment for the Postal Service. If we don't heed this warning and act quickly, the Postal Service as we know it will cease to exist in the very near future, possibly by the end of this fiscal year. This would effectively shut down the U.S. mailing industry that depends on the Postal Service. A shutdown of an industry of its magnitude, with some 7 million employees and more than $1 trillion in revenue every year, would be catastrophic to our fragile economic recovery."It's estimated that the Postal Service has overfunded its obligations to the Federal Employees Retirement Systems (FERS) by about $7 billion. The Postal Service's decision to suspend payments to FERS is just one painful step of many that may be necessary to help keep the Postal Service solvent in the short term. It will not, however, fix all that ails the Postal Service.
"Earlier this year I introduced comprehensive legislation, the POST Act, to address the significant challenges facing the Postal Service and to put the Service back on a solid financial path. We need to move quickly on this effective and comprehensive legislation before it's too late. My bill requires all parties – postal management, employees, customers, and the Postal Service's competitors – to make sacrifices to ensure the solvency of the Postal Service over the long term.
"It also gets Congress out of the way by providing the flexibility and tools necessary to address the problems plaguing the Postal Service in an effective way. One of the reasons why the Postal Service finds itself in this precarious financial state is that for decades it's overpaid into not only FERS, but also to the older Civil Service Retirement System (CSRS), totaling between $50 billion and $75 billion. Currently, it is unlawful for the Postal Service to use these overpayments to meet other overall Postal Service expenses. My bill would change that.
"I'd like to thank the Obama Administration for working with the Postal Service to take this difficult short-term action without threatening postal employees' pension eligibility. I urge the Administration to deepen its cooperation with the Postal Service and Congress in the coming days to help us find a long-term solution to ensure the Postal Service's survival. Despite the dire fiscal outlook, there is hope for the Postal Service's future. We can turn things around by quickly passing comprehensive legislation, such as the one I've proposed, that would give the Postal Service the room it needs to manage itself and avoid it becoming the latest victim of Congressional gridlock."