Longtime federal workers could retire as early as age 43 -- if their agencies would pick up the extra costs associated with early retirement -- under a legislative proposal being worked up by the Office of Personnel Management.

The proposal, which is at the staff level at this point, would be a boon to agencies looking for alternatives to layoffs. It would allow them to authorize employes to retire on immediate, but reduced, pensions, either at age 50 with 20 years of service, or at any age with 25 years' service.

The catch is that agencies, rather than the civil service retirement fund and the Treasury, would have to pay the lifetime extra costs of each early retirement they authorized.

Currently, agencies must get OPM permission for early-outs, and they are granted only in cases of major layoffs or reorganizations. It often limits them to workers in specific geographic areas, grades or jobs.

Early retirement is costly to the government because employes pay in less of their salary to the civil service retirement fund and draw benefits, indexed to the rate of inflation, for a much longer time than if they served full careers. Under normal conditions, workers can retire at age 55 with 30 years' service, although the average retirement age is 61, according to OPM.

Early retirement is supposed to benefit the government. But it has been used as a final payoff, or push, to put workers out to pasture early, with the costs passed on to the federal retirement program or the taxpayers. Since OPM cracked down on early retirements several years ago the number has dropped dramatically.