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IG Report: Old-Age, Survivors and Disability Insurance Benefits Affected by State or Local Government Pensions

November 10, 2011
November 9, 2011
Contact: (410) 965-2671
The Inspector General for the Social Security Administration (SSA) issued a report today that estimated SSA overpaid about $623.8 million in Old-Age, Survivors and Disability Insurance benefits to approximately 24,900 beneficiaries.  The payment errors occurred because Agency staff did not reduce Social Security payments in accordance with two provisions of the Social Security Act.
Social Security benefits can be reduced when paid to individuals who receive a pension based on Federal, State, or local government employment not covered by Social Security.  The Windfall Elimination Provision eliminates “windfall” Social Security benefits for retired or disabled workers and their families who are receiving pensions from employment not covered by Social Security.  The Government Pension Offset provision reduces monthly Social Security benefits for spouses, divorced spouses, and surviving spouses who receive a pension based on their own work for a Federal, State, or local government not covered by Social Security.
The Inspector General reported that SSA overpaid beneficiaries because the Agency did not know about the State or local government pensions they received.  If SSA does not take action to identify and correct these payment errors, the report, estimates that SSA could improperly pay about $869.9 million over the beneficiaries’ lifetimes.
The report recommended SSA take certain actions, which included:
  • Pursuing legislation and alternative approaches for electronically obtaining State and local government pension data, and
  • Evaluating beneficiary characteristics to determine whether it is cost-effective for SSA to identify similar overpayments to beneficiaries with unreported pensions subject to these provisions.
To view the full report, click here, or for more information, contact the OIG's Office of External Relations, at (410) 965-2671.  Refer to Common Identification Number A‑13‑10‑10143. 
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