How the Social Security Act could change 2025 benefits

The House of Representatives has passed legislation that could see welfare changes for millions of recipients — but it still awaits Senate approval.

The Social Security Fairness Act was passed with significant bipartisan support by the House on November 12 and will now go to the Senate. The bill would repeal two federal policies that currently limit Social Security payments for about 2.8 million Americans who work in federal, state and local jobs.

The bill attracted headlines earlier this fall when its House sponsors, Virginia Democrat Abigail Spanberger and Louisiana Republican Garret Graves, succeeded in filing a discharge petition — a method of taking a bill to the House floor for consideration without a report from the appropriate committee – to force a vote on the bill.

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What is the Social Security Fairness Act?

If passed into law, the Social Security Fairness Act would eliminate two provisions: the Windfall Elimination Provision and the Government Pension Offset.

WEP reduces Social Security benefits for people who receive pensions from public sector jobs, such as state and federal employees, who are or were not required to pay Social Security tax contributions, even though they have contributed to Social Security through other jobs in their careers and are in otherwise entitled to benefits. This provision currently affects approx. 2 million recipients.

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The GPO reduces spousal or survivor benefits for retired federal, state, and local government workers who have not paid into Social Security through payroll taxes. This rule affects nearly 800,000 retirees.

To summarize, the bill will:

• Repealing provisions that reduce Social Security benefits for people receiving other benefits, such as a state or local government pension.
• Eliminates the public pension equalization, which can reduce Social Security benefits for spouses, widows and widowers who also receive their own public pensions.
• Eliminates the windfall elimination provision, which in some cases reduces Social Security benefits for individuals who also receive a pension or disability benefit from an employer that did not withhold Social Security taxes.

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How would the bill change Social Security benefits?

If the bill passes the Senate and is signed by the president, it would mean an increase in benefits for all those currently subject to the WEP and GPO. A 2020 study by the Urban Institute revealed that eliminating both provisions would increase benefits for 4.5 percent of all recipients in 2025, with an average annual increase of approximately $7,300. However, it would add about $195 billion to federal deficits over 10 years, the Congressional Budget Office has estimated.

A date for a Senate vote has not yet been scheduled. If it eventually passes, it will apply to all benefits payable after December 2023.

Spanberger and Graves, along with Senate sponsors Democrat Sherrod Brown and Republican Susan Collins, urged Senate Majority Leader Chuck Schumer and Minority Leader Mitch McConnell to bring the bill to a vote in a letter released this week. They said Americans subject to the provisions “are penalized for supporting and protecting our neighbors and families, educating our children, providing health care to our veterans, delivering our mail and more.”

Newsweek has reached out to Schumer and McConnell’s offices for comment by email outside regular business hours.