"Under current law, Maine public school teachers who work second jobs during the summer months to help make ends meet are penalized for it: they lose legitimately earned Social Security benefits," said Senator Collins. "In certain cases, their wives and husbands will lose spousal benefits, too. It is not fair that a retired teacher who worked summers in the private sector does not receive full Social Security benefits despite having paid taxes on those summer earnings. This legislation will eliminate that inequity."
The legislation repeals two provisions in the current Social Security Act that create this problem: The Windfall Elimination Provision and the Government Pension Offset provision. The Windfall Elimination Provision reduces Social Security benefits for retirees who paid into Social Security and also receive a government pension, such as from a teacher retirement fund, based on employment that was not covered under Social Security. Private sector retirees receive monthly Social Security checks equal to 90 percent of their first $561 in average monthly career earnings, plus 32 percent of monthly earnings up to $3,381 and 15 percent of earnings above $3,381. Government pensioners, however, are only allowed to receive 40 percent of the first $561 in career monthly earnings -- a penalty of $280.50 per month.
The current Government Pension Offset provision reduces Social Security spousal benefits by an amount equal to two-thirds of the spouse''s public employment civil service pension. This can have the effect of taking away, entirely, a spouse''s benefits from Social Security.
During the 107th Congress, Senator Collins led the fight to repeal these inequities. Through her website, she gathered signatures from 8,000 Mainers affected by the inequity and forwarded them to the Chairman of the Senate Finance Committee to urge him to take up the measure. Senator Collins continues to fight for passage of the legislation.
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