A fight over what the Panama Canal treaty will cost the U.S. civil service pension program threatens to block or slow House action on basic portions of the treaty due to go into effect this fall.
The Senate already has approved return of the canal to the Republic of Panama, but the House must approve legislation to take care of U.S. and Panamanian workers who will lose their jobs because of the treaty.
Rep. Gladys N. Spellman (D-Md.) says she will stall hearings and ask for a congressional subpoena to be served on the Office of Personnel Management. She wants to know how OPM -- the government's caretaker of employe benefits -- arrived at a "low" figure of $205 million as the cost of the treaty to the federal pension fund.
President Carter sold the treaty on grounds that it was fair to both nations, and would not cost the taxpayers anything. But agreements in the treaty provide for the U.S. -- through the federal retirement fund -- to give special early retirement or other benefits to American and Pan-amnians whose job will be affected by Panama's canal takeover.
Administration officials have told Congress that the cost of the retirement features would run about $205 million, and that the federal retirement fund will pay them.
The treaty, includes some unusual and attractive retirement benefits. Employes will be offered the option of retiring early (as young as age 43, with long service) on reduced, but immediate pensions. Panamanians who transfer over to their government's service could get what amounts to double refunds from the U.S. retirement system. They would represent what each employe paid in, as well as the amount the government contributed to their retirement.
That double benefit is not available to U.S. government workers who quit or take other jobs before retirement.
Spellman estimates the actual cost to the pension fund will be double the OPM estimate. She says it used a "static" projection, which did not take into account annual U.S. pay raises or twice-yearly cost-of-living annuity adjustments. Spellman believes the OPM did it that way to come up with an "intentionally low" and unrealistic figure for Congress.
She has asked the General Accounting Office to find out from OPM what the costs would be if a "dynamic" cost projection were used. That would take into account estimated raises and pension adjustments for retirees or their survivors.
A spokesman for GAO said his office had been denied the data from a "low level" OPM official. Gao/ told Spellman's office that the OPM employe said he was "under orders" not to give additional treaty cost data to the congressional watchdog agency.
(An OPM spokemsan said yesterday that he thought the whole thing was a misunderstanding that could be cleared up. He said it is OPM policy not to give out estimates until approval by the director and presentation to Congress. He said GAO made its request before the estimates had been worked up, but now that the testimony has been given the OPM is "open to anybody" who wants to get data from it, including information about how it arrived at its estimate.)
Chairman James M. Hanley (D-N.Y.), just back from a fact-finding hearing in Panama, estimates the federal pension fund will be hit with a $500 million bill in the future. He heads the Post Office and Civil Service Committee that must approve the retirement package. Spellman chairs a subcommittee dealing with federal retirement matters.
Hanley said he is "unhappy" that the cost of the Panamanian program must be borne by the retirement fund. He has scheduled hearings next week at which time both sides can be expected to be armed with cost estimates, and committee members will debate the wisdom of charging the treaty expenses to the federal pension fund.
Two potential presidents will highlight the March 19-20 meeting of AFL-CIO's Public Employes Department. PED takes in most of the affiliated federal, postal and public sector unions, and it will have its legislative conference at the Washington Hilton. Vice President Walter Mondale is the March 19 speaker, and Sen. Edward M. Kennedy (D-Mass.) will talk about national health insurance the next day.