Officials Confirm Pensioners Won't Get COLA in 2010

On Oct 16, 2009, the federal government confirmed what was long suspected: federal retirees will have no cost-of-living adjustment (COLA) in their pensions in 2010.

The good news is that consumer prices - the benchmark used to determine annual COLA rates - didn't increase in 2009.

The bad news is that retirees will see no increases in checks, whether you are part of the Federal Employees Retirement System or the Civil Service Retirement System.

2009 COLA, 5.8%, WAS LARGEST INCREASE

Retirement checks in 2009 increased 5.8 percent for Civil Service Retirement System retirees and 4.8 percent for Federal Employees Retirement System retirees. This percentage represented the largest increase since 1982.

The 5.8% COLA increase for 2009 was due largely to higher gas prices; due in part to the weaker economy, gas prices has since declined.

Social Security benefits, which are provided to Federal Employees Retirement System retirees, will also not increase in 2010. This marks the first year without an automatic cost-of-living adjustment in Social

Security checks since COLAs were established in 1975.

PRESIDENT OBAMA ASKING FOR $250 ONE-TIME BENEFIT

President Barack Obama asked Congress to provide a one-time payment of $250 to all 57 million Americans who receive Social Security and Supplemental Security Income benefits. The additional $250 would represent a 2 percent increase in benefits for the average Social Security beneficiary.

This would be in addition to the $250 payment Social Security recipients received earlier this year through the Recovery Act.

Federal Employees Retirement System retirees who receive Social Security as part of their federal benefits package would be eligible for the $250 payments.

Civil Service Retirement System retirees, except those with Social Security earnings outside their federal employment, would not be eligible.

COLAs are based on the annual change in the Consumer Price Index for Urban Wage Earners and Clerical Workers. The index fell 2.1 percent from the third quarter of 2008 to the third quarter of 2009, according to the Bureau of Labor Statistics.