SSA Trustees: Disability Trust Fund Gains One Year Of Solvency To 2023; COLA For 2017 Estimated At Only 0.2%
The Disability Insurance (DI) Trust Fund gained a year of solvency with reserves not reaching depletion until 2023, according to Stephen Goss, Chief Actuary of the Social Security Administration (SSA), during the June 22 hearing of the Social Security Subcommittee of the House Ways and Means Committee. If no measures are taken by then, there would only be sufficient income coming in to pay 89 percent of scheduled disability benefits.
The Social Security Board of Trustees issued its annual report today on the actuarial status of the DI and Old-Age and Survivors Insurance (OASI) trust funds. The SSA also issued a press release summarizing the Trustees report.
Goss attributed the one-year extension to a decline in program expenditures and dropping Social Security disability applications since 2010. The DI Trust Fund had been set to run out of reserves in 2016, prior to the passage of the Bipartisan Budget Act of 2015 last fall, which reallocated 0.57 percentage points of the payroll tax to the DI fund from the OASI fund. (The Act extended solvency to 2022.)
Overall, Goss reported the combined Social Security Trust Funds reserves will reach exhaustion in 2034, the same as the 2015 Trustees Report. At that time, there will be sufficient income coming in to pay only 79 percent of scheduled benefits.
The report also projected a minimal cost-of-living adjustment (COLA) of 0.2 percent in December 2016, based on estimates for the Consumer Price Index (CPI). The official COLA will not be available until later in the year, following third-quarter results from the CPI for Urban Wage Earners and Clerical Workers, or CPI-W.
Subcommittee members asked Goss for solutions during today's hearing, and he outlined a combination of options available to Congress. They included: reducing the amount of benefits paid to beneficiaries to reduce program costs, increasing the tax rate to generate new revenue, or a combination of these types of measures.
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