Retirement Fund Tapped to Avoid National Debt Limit
The Treasury Department has started drawing from the civil service pension fund to avoid hitting the $8.2 trillion national debt limit. The move to tap the pension fund follows last month's decision to suspend investments in a retirement savings plan held by government employees.
In a letter to Congress this week, Treasury Secretary John W. Snow said he would rely on the Civil Service Retirement and Disability Fund to avoid bumping up against the statutory debt limit. He said the Treasury is suspending investments and will redeem a portion of the money credited to the fund.
Once Congress raises the debt limit, the Treasury will "restore all due interest and principal" to the pension fund as soon as possible, Snow said. He made a similar promise when the Treasury announced that reinvestment of some assets in the Thrift Savings Plan's government securities fund, or G Fund, had been suspended.
The civil service trust fund will provide the Treasury with several billion dollars for extra borrowing. The fund had an estimated balance of about $655 billion at the start of the year, but only a small portion of that is available to the Treasury because of the statutes restricting the fund's use during "debt issuance suspension" periods. The G Fund has assets of about $65.3 billion, and all are available for Treasury's use.
The Treasury has leaned on federal employee retirement funds in past years when officials worried about a possible default on the national debt, and most federal employees take it in stride. Still, many employees object to the financial maneuvers, arguing that they amount to a raid on their personal accounts.
Colleen M. Kelley , president of the National Treasury Employees Union, said last month that federal employees should not have their pension accounts "used as a rainy day fund. . . . No private-sector employer would ever be allowed to do this."
Snow wrote to Congress that his maneuvers will buy time until mid-March and urged lawmakers "to pass a debt limit increase immediately." He said the Treasury "has now taken all prudent and legal actions to avoid reaching the statutory debt limit."
Computer security remains a priority for the government's top technology officials in the second term of the Bush administration, according to a survey sponsored by a trade group.
Interviews with 39 senior federal technology officials, including 20 chief information officers, showed that progress is being made in improving computer security to ward off viruses, hackers and the inappropriate disclosure of sensitive information, said the report released yesterday by the Information Technology Association of America.
But the survey also found that federal officials thought they were making less progress in safeguarding privacy. "The consensus seems to indicate that privacy needs to be elevated as an issue and was getting priority attention in only a few agencies where public concerns were driving the issue," the report said.
The report was based on interviews in the second half of 2005 with current and former high-tech officials in the government. Grant Thornton, an accounting and business-management firm, helped sponsor and conduct ITAA's 16th annual survey.
Improvements in project management also are a high priority for technology officials, said Paul Wohlleben , a Grant Thornton partner who helped oversee the survey. Federal officials see challenges in training and keeping staff and finding consistent ways to measure progress on projects, he said.
The majority of federal technology officials stay in the jobs between two and four years, slightly less than in the past, the survey found. A higher percentage of technology officials are political appointees today, and that may help explain the shorter tenure.
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