NARFE: COLA Announcement Reinforces Need for a New COLA Formula

10/13/2017 Alexandria, VA – The cost-of-living adjustment (COLA) to federal civilian retirement annuities and Social Security benefits will be 2.0 percent in 2018, pursuant to the latest consumer price data released this morning by the Bureau of Labor Statistics (BLS). Richard Thissen, president of the National Active and Retired Federal Employees Association (NARFE), issued the following statement in response:

cost-of-living

“Following two years of no and low cost-of-living adjustments (COLAs), today’s announcement was eagerly awaited by millions of Americans who rely on the increase to keep up with the rising prices for food, housing, gas and medical care. Unfortunately, the 2.0 percent COLA provides only partial relief and serves as a reminder that our method for calculating the increasing cost of goods and services is out of sync with the reality faced by federal annuitants, Social Security recipients and military retirees. Our nation’s seniors spend more than twice as much on medical care than the population measured by the current formula to calculate COLAs, the CPI-W. Congress must act to implement a new formula that adequately measures costs incurred by seniors.

“The COLA is outpaced by the average 6.1 percent increase in health care premiums for federal retirees in 2018. On top of this, Medicare premiums increased disproportionately for most federal annuitants during the last two years, and long-term care premiums sharply increased by 83 percent, on average. A new a cost-of-living formula that doesn’t force these Americans to take one step forward, then two steps back is long overdue.

“Today’s COLA announcement highlights why Congress should require use of the CPI-E (Consumer Price Index for the elderly) as the measurement for setting COLAs. It is crystal clear that the current formula does not accurately reflect how seniors spend their limited annuities.”

4 thoughts on “NARFE: COLA Announcement Reinforces Need for a New COLA Formula

  1. 3 days ago while driving home I heard the author of the book “rich dad, poor dad” state that true inflation is 6-9%. seeing how a Nissan Altima is now 25K and a Chevy truck is now 35-45K……..i tend to agree with him. never believe the federal government….about anything!

  2. Just think if the planed cuts to Federal retirement benefits becomes in force big tax cuts will be granted to the hard pressed rich. Now is not the time to think of yourself, think of the unfortunate big time operators! They have country club expenses and yachts to take care of. For the good of the nation, the rich must have the burden lifted off their shoulders! And as for the Federal employee, we haven’t given enough yet.

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