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President Bush proposed an additional $26.7 million this week to modernize the federal retirement system, with a goal of authorizing requests for new retirement benefits within five days and achieving at least 95 percent accuracy in payments.

The money will be used to "greatly improve the speed and accuracy of federal retiree benefit payments," according to Bush's 2007 budget, unveiled Monday. Many federal retirees find it takes months until they receive an accurate annuity payment after they retire.

The Retirement Systems Modernization, as the project is known, will convert "millions of paper retirement records to electronic data and contract for the information technology needed for the system," the Office of Personnel Management stated in a budget document.

OPM's Chief Financial Officer Clarence Crawford told reporters Wednesday that the increase is especially gratifying in a year when the president is proposing major cuts in many domestic agencies.

The increase "demonstrates the administration's value and commitment to the Retirement Systems Modernization." Crawford said. "That got the lion's share of the increase. For [a] domestic agency to have gotten that kind of increase shows the full support of the administration."

OPM's total discretionary budget received a proposed net increase of $17.2 million from the fiscal 2006 funding enacted by Congress. The agency is funding almost $14 million of its requested discretionary increase through internal offsets.

When Linda Springer took over as OPM's director last summer, she said resolving the annuity delays was "right at the top of the list" of her goals.

"If you've moved from place to place, several agencies -- and by and large we've been in a paper environment for a lot of your records -- it will take time for your actual annuity amount to be finalized," Springer said at the time. "That's a system that needs to be fixed . . . It's more back-office . . . a sign of excellence, a sign of good management that I think American taxpayers deserve."

In addition to the retirement modernization project, OPM is seeking $1.5 million for more employees to process annuities until the new system is brought online. OPM said it anticipated taking 18 to 36 months to complete the upgrade once the agency awards the contract.

A modernized system will allow the government to tabulate benefits for new retirees in five days or less, OPM said. The system also will improve accuracy of the claims from 90 percent to 93 percent in the older Civil Services Retirement System and from 95 percent to 97 percent in the Federal Employee Retirement System.

COMMENTS

• Better be glad they don't follow the postal service policy. I was told of a lady who retired from the USPS and her former boss held her check for leave closeout in his safe for 11 months, and then suddenly discovered it was there. She had been waiting for that money for almost a year. Now, tell me somebody should not have been fired immediately over this. This is what causes postal personnel to "go postal." This is because Congress and the administration allow this kind of system to erupt and continue forever. Martin Posted February 16, 2006 4:25 PM
• Please don't suggest that OPM go DFAS for assistance. The answer does not lie there; trust me -- DFAS has been screwing up civilian pay, vendor payments, and anything else they could get their hands on since inception. The reason military are paid correctly is that a military person’s career is managed from the time they come into the service until retirement. That means accurate record keeping, assignment specific training for both current and future positions, and accountability for accomplishing both. Military records are well maintained and don't get lost. When a military person retires, that does not necessitate four or five different offices all scrambling to put together the pieces of paper that may or may not have been properly filed over a 30-plus career. Personally, I have recreated my personnel file twice in my career because the personnel office could not find my records. Thank goodness I keep my own up-to-date files. By the way, I recently retired, and it took 4 months from my date of retirement to get paid properly. Seven months if you count the fact that three months prior to retirement I submitted my retirement package to OPM as suggested by OPM. And that bite OPM takes until they figure out what you are actually entitled to, it's huge. God forbid they would overpay, so they so grossly underpay you that you wonder if retirement was such a good idea. GovExec.com reader Posted February 17, 2006 11:53 PM
• Maybe OPM should take a peek at the system used by the Defense Accounting & Finance Center. For years, military personnel have been retiring and receiving the correct retirement pay on the first of every month. Many servicemen and women have various periods of creditable service from a variety of mixes of reserve and active duty. Somehow, DAFC seems to get it right. Rob Hawes Posted February 13, 2006 7:00 PM