Congressman Eliot Engel (D-NY) and Senator Sheldon Whitehouse (D-NY) introduced bicameral legislation Monday that would guarantee a Social Security cost-of-living adjustment (COLA) with annual floor of no less than 3 percent.
The Guaranteed 3% COLA For Seniors Act is similar to other legislative attempts to increase the retiree COLA, including the Fair COLA for Seniors Act of 2019 introduced by Congressman John Garamendi (D-CA) in March.
- 2020 Federal Retiree COLA Watch
- Guide to Federal Retiree COLAs: What Are They and How Are They Calculated?
- Federal Retiree COLA History: CSRS COLA and FERS COLA
“Our seniors have lived with paltry Social Security increases for too long. It’s time to revamp the formula and guarantee older Americans are given the support they need and deserve,” Engel said.
“Seniors paid into Social Security over decades of hard work with the expectation that they would be able to rely on those benefits to help pay for basic necessities like food, housing, and medical care in retirement,” said Whitehouse. “The federal government needs to provide an annual cost of living adjustment that actually keeps up with rising costs and protects the purchasing power of Social Security benefits.”
The bill would also update the formula the government uses to determine seniors’ yearly COLA to one the legislators believe better reflects the costs seniors typically face.
Currently, annual Social Security COLA increases are tied to a measure of inflation called the Consumer Price Index for Urban Wage Earners and Clerical Workers (CPI-W). “This index doesn’t adequately measure the expenses inured by older Americans such as doctor visits and medication costs,” according to a statement on Engel’s website. “This bill would direct the Bureau of Labor Statistics to develop the Consumer Price Index for the Elderly (CPI-E), which would specifically track seniors’ expenses and use that data to determine COLA adjustments. Using this index would ensure COLA adjustments better reflect the true living costs that seniors face.”
“Since 2010, the COLA has been zero 3 times — in 2010, 2011 and 2016. In 2017 the COLA was just 0.3 percent. In fact, over the past 9 years, the COLA has averaged just 1.4 percent, just half the 3 percent average from 1999 to 2009. This legislation strengthens Social Security benefits for all retirees providing a protection more than 68 million Social Security recipients can count on,” said Mary Johnson, Policy Analyst for The Senior Citizens League.