The Federal Thrift Savings Plan (TSP) is an important part of the retirement system for federal employees and retirees. For some in the military, this may be their only retirement savings. But twice this year, Congress floated the idea of changing the rate of return for the G Fund, the largest fund in the TSP, so that employees, retirees, and service members receive less money when they retire. As the budget deadline is drawing near, G Fund will once again become an easy target.
The Employee Thrift Advisory Council, whose members include AFGE, NAGE, NARFE, NTEU, postal unions, the Uniformed Services, and other federal employee organizations, is urging Congress to make the G Fund off limits to any budget debates. Just the suggestion of a change to the TSP indicates that the TSP is no longer a secure place to put their retirement money.
Since 1987, the Federal Thrift Investment Board decides what happens with the TSP, and the board has a fiduciary duty to consider first and foremost what’s best for TSP participants. In 1989, Congress and the Office of Management and Budget agreed that the TSP should not be considered part of the budget.
"In order for people to feel the TSP is a reliable investment, Congress has to declare the TSP off-limits as a source of revenue," said ETAC Chair Clifford Dailing in a letter to congressional leaders. "It is the only way to convince our members—federal employees and retirees, as well as members of the Uniformed Services—to continue to invest in the fund and plan for their future."
AFGE signed the letter along with other unions.