OPM Suggests Retirement Reforms

The OPM said the formula "can occasionally yield anomalous results" for federal employees who worked before April 1986, usually full time, and then retired after that as part-time employees. The agency's proposal would eliminate "the potential adverse effect" of working part time near the end of a federal career, Springer wrote Congress.

· Allow federal employees to invest their bonuses in the Thrift Savings Plan, the 401(k)-type program that the vast majority of government workers use to save for retirement.

Investing bonuses in the TSP would be subject to limits on retirement contributions set by the Internal Revenue Service each year, and there would be no matching government contribution for any bonus money invested, the OPM said.

Springer called attention to the proposed rule changes in a memo she posted on the OPM Web site. Similar proposals have been made over the past couple of years, either by the administration or by members of Congress, but did not draw widespread support on Capitol Hill.

But Springer has warned that retirements could surge from 2008 to 2010 as baby boomers depart public service. In her view, the government needs to do more to keep talented employees and bring back retirees with expertise that could be used to train new hires or to carry out sensitive projects.

The goal of the proposals, Springer wrote in her Web memo, is to provide agencies "with the tools they need to keep pace and compete with the private sector for skilled knowledge workers."

Stephen Barr's e-mail address isbarrs@washpost.com.