The house votes tomorrow on a set of budget-cutting items that includes limiting federal and military retirees to a single COL (cost of living) raise each year.
Moving from twice-yearly inflation catchups to a single COL adjustment could cost the typical federal retiree $1 a day in future pension benefits.
If the House okays the resolution of its Budget Committee, the next step will be to translate that sense-of-congress action into legislative packages that will accomplish the savings. The Carter Administration has introduced one such vehicle, a bill that would eliminate one of the two COL adjustments that retirees now get in favor of a one-shot adjustment each March.
Several years ago Congress deliberalized the federal-military retirement system, but promised retirees two COL raises a year in return. Those adjustments now come each March and September. The March boost was 6 percent. Last September's before-taxes raise was 6.9 percent.
Since the economy moved into double-digit inflation, politicians have been looking for ways to save money and achieve that politically magic objective: a balanced budget. One way to do it would be to cut the number of times the government raises annuities and pensions of the more than 3 million federal and military retirees.
(Based on a 15 percent inflation rate, federal officials say deferring the COL raises until March of each year would save the government about $360 annually on the average annuity.)
A few amendments will be offered on the House floor to kill or modify some Budget Committee recommendations. But insiders predict there will be not attempt then to save the two COL raises. "We'd get out tails kicked all over the floor," one staffer commented
The Budget Committee resolution is not binding on "jurisdictional" committees who control the flow of legislation. But adoption of the resolution by the full House would amount to a mandate to make the savings. The Budget Committee does have power to order a committee to report legislation to accomplish budget cuts, although it cannot dictate the form of the cuts.
The committee with jurisdiction over the COL raises is Post Office-Civil Service. Most of its members are kindly disposed to federal-postal workers, and favor retaining the two COL adjustments. If forced to make the savings, they will probably try to do ti another way -- perhaps with the October pay raise.
The Budget Committee estimates that a shift to a single COL raise for retirees would save $1.1 billion in 1981, about $590 million of it in delayed payments to retired civilians.