COLA Announcement Renews Need for New Inflation Formula
| FOR IMMEDIATE RELEASE | Contact: Jessica Klement |
| October 30, 2013 | 703-838-7760 |
| jklement@narfe.org |
Alexandria, VA – Following the Bureau of Labor Statistics announcement of a 1.5 percent cost-of-living adjustment for 2014, Joseph A. Beaudoin, president of the National Active and Retired Federal Employees Association (NARFE), released the following statement on the impact to federal civilian retirement and Social Security benefits:
“The cost-of-living adjustment (COLA) for next year is welcome news for countless Americans who rely on the increase to keep up with the rising price of food, housing, transportation and medical care. Despite the partial relief this COLA will provide, the announcement is a reminder that our method for calculating the rising cost of goods and services is out of sync with the reality faced by millions of federal retirees, Social Security recipients and military retirees, who spend more than twice as much on medical care than the population measured by the CPI-W formula.
“The average 4.4 percent increase in healthcare premiums for federal employees in 2014 shows that medical costs continue to outpace the COLA as it is calculated presently. We need a formula that doesn’t force these Americans to take one step forward, then two steps back.
“While the present formula isn’t perfect, a proposed switch to the Chained CPI would only make a bad situation worse by further decreasing the hard-earned benefits of Social Security recipients and federal retirees, while increasing taxes on lower- and middle-income taxpayers.
“As members of Congress continue to negotiate a budget, I urge them to consider the CPI-E formula, a more accurate measure of inflation that accounts for health care and other costs facing seniors.”
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The National Active and Retired Federal Employees Association (NARFE), one of America’s oldest and largest associations, was founded in 1921 with the mission of protecting the earned rights and benefits of America’s active and retired federal workers. The largest federal employee/retiree organization, NARFE represents the retirement interests of nearly five million current and future federal annuitants, spouses and survivors.
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