Description of Proposed Provision:
B3.7: Progressive indexing (30th percentile) of PIA factors beginning with individuals newly eligible for OASI benefits in 2020, continuing through 2029, and resuming in 2068: Create a new bend point at the 30th percentile of the AIME distribution of newly retired workers. Maintain current-law benefits for earners at the 30th percentile and below. Reduce the 32 and 15 percent factors above the 30th percentile such that the initial benefit for a worker with AIME equal to the taxable maximum is reduced by 1.20 percent per year as compared to current law (for the years that progressive indexing applies). Disabled workers are: (a) not affected prior to normal retirement age; and (b) subject to a proportional reduction in benefits, based on the worker's years of disability, upon conversion to retired-worker beneficiary status.
Financial Estimates for the OASDI Trust Fund Program
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
|
Expressed as a percentage of current-law taxable payroll |
Trust fund ratio as of January 1 |
Expressed as a percentage of current-law taxable payroll |
|||||||
|
Calendar year |
Cost rate |
Income rate |
Annual balance |
Cost rate |
Income rate |
Annual balance |
|||
| 2017 | 13.41 | 13.03 | -0.38 | 298 | 0.00 | 0.00 | 0.00 | ||
| 2018 | 13.49 | 12.93 | -0.56 | 287 | 0.00 | 0.00 | 0.00 | ||
| 2019 | 13.70 | 12.95 | -0.75 | 273 | 0.00 | 0.00 | 0.00 | ||
| 2020 | 13.85 | 12.96 | -0.89 | 259 | -0.00 | -0.00 | 0.00 | ||
| 2021 | 14.01 | 12.99 | -1.02 | 245 | -0.00 | -0.00 | 0.00 | ||
| 2022 | 14.25 | 13.02 | -1.23 | 230 | -0.00 | -0.00 | 0.00 | ||
| 2023 | 14.53 | 13.05 | -1.49 | 215 | -0.01 | -0.00 | 0.01 | ||
| 2024 | 14.81 | 13.08 | -1.73 | 199 | -0.02 | -0.00 | 0.02 | ||
| 2025 | 15.07 | 13.10 | -1.97 | 183 | -0.03 | -0.00 | 0.03 | ||
| 2026 | 15.33 | 13.13 | -2.20 | 166 | -0.04 | -0.00 | 0.04 | ||
| 2027 | 15.56 | 13.15 | -2.41 | 149 | -0.06 | -0.00 | 0.06 | ||
| 2028 | 15.77 | 13.16 | -2.61 | 132 | -0.08 | -0.00 | 0.08 | ||
| 2029 | 15.96 | 13.18 | -2.78 | 114 | -0.11 | -0.01 | 0.10 | ||
| 2030 | 16.12 | 13.19 | -2.94 | 97 | -0.14 | -0.01 | 0.13 | ||
| 2031 | 16.27 | 13.20 | -3.07 | 79 | -0.18 | -0.01 | 0.17 | ||
| 2032 | 16.39 | 13.21 | -3.19 | 61 | -0.21 | -0.01 | 0.20 | ||
| 2033 | 16.49 | 13.21 | -3.27 | 42 | -0.25 | -0.01 | 0.24 | ||
| 2034 | 16.55 | 13.22 | -3.34 | 23 | -0.29 | -0.02 | 0.28 | ||
| 2035 | 16.59 | 13.22 | -3.37 | 4 | -0.34 | -0.02 | 0.32 | ||
| 2036 | 16.61 | 13.22 | -3.39 | ---- | -0.38 | -0.02 | 0.36 | ||
| 2037 | 16.60 | 13.22 | -3.38 | ---- | -0.42 | -0.02 | 0.39 | ||
| 2038 | 16.57 | 13.22 | -3.34 | ---- | -0.45 | -0.03 | 0.43 | ||
| 2039 | 16.51 | 13.22 | -3.29 | ---- | -0.49 | -0.03 | 0.46 | ||
| 2040 | 16.44 | 13.22 | -3.22 | ---- | -0.52 | -0.03 | 0.49 | ||
| 2041 | 16.36 | 13.21 | -3.15 | ---- | -0.55 | -0.03 | 0.52 | ||
| 2042 | 16.28 | 13.21 | -3.07 | ---- | -0.58 | -0.03 | 0.55 | ||
| 2043 | 16.20 | 13.21 | -2.99 | ---- | -0.61 | -0.03 | 0.58 | ||
| 2044 | 16.12 | 13.20 | -2.92 | ---- | -0.64 | -0.04 | 0.60 | ||
| 2045 | 16.06 | 13.20 | -2.86 | ---- | -0.66 | -0.04 | 0.63 | ||
| 2046 | 15.99 | 13.20 | -2.80 | ---- | -0.69 | -0.04 | 0.65 | ||
| 2047 | 15.94 | 13.19 | -2.74 | ---- | -0.71 | -0.04 | 0.67 | ||
| 2048 | 15.88 | 13.19 | -2.69 | ---- | -0.73 | -0.04 | 0.69 | ||
| 2049 | 15.84 | 13.19 | -2.65 | ---- | -0.75 | -0.04 | 0.71 | ||
| 2050 | 15.80 | 13.19 | -2.61 | ---- | -0.77 | -0.04 | 0.73 | ||
| 2051 | 15.77 | 13.19 | -2.58 | ---- | -0.79 | -0.04 | 0.74 | ||
| 2052 | 15.75 | 13.19 | -2.57 | ---- | -0.80 | -0.05 | 0.76 | ||
| 2053 | 15.75 | 13.19 | -2.56 | ---- | -0.82 | -0.05 | 0.77 | ||
| 2054 | 15.76 | 13.19 | -2.57 | ---- | -0.83 | -0.05 | 0.79 | ||
| 2055 | 15.77 | 13.19 | -2.58 | ---- | -0.85 | -0.05 | 0.80 | ||
| 2056 | 15.80 | 13.19 | -2.61 | ---- | -0.86 | -0.05 | 0.81 | ||
| 2057 | 15.83 | 13.19 | -2.64 | ---- | -0.87 | -0.05 | 0.82 | ||
| 2058 | 15.86 | 13.20 | -2.67 | ---- | -0.88 | -0.05 | 0.83 | ||
| 2059 | 15.90 | 13.20 | -2.70 | ---- | -0.88 | -0.05 | 0.83 | ||
| 2060 | 15.94 | 13.20 | -2.74 | ---- | -0.89 | -0.05 | 0.84 | ||
| 2061 | 15.98 | 13.20 | -2.77 | ---- | -0.90 | -0.05 | 0.85 | ||
| 2062 | 16.02 | 13.21 | -2.81 | ---- | -0.90 | -0.05 | 0.85 | ||
| 2063 | 16.06 | 13.21 | -2.85 | ---- | -0.91 | -0.05 | 0.85 | ||
| 2064 | 16.11 | 13.21 | -2.89 | ---- | -0.91 | -0.05 | 0.86 | ||
| 2065 | 16.15 | 13.22 | -2.94 | ---- | -0.91 | -0.05 | 0.86 | ||
| 2066 | 16.20 | 13.22 | -2.98 | ---- | -0.92 | -0.05 | 0.86 | ||
| 2067 | 16.25 | 13.22 | -3.03 | ---- | -0.92 | -0.05 | 0.87 | ||
| 2068 | 16.30 | 13.23 | -3.07 | ---- | -0.92 | -0.05 | 0.87 | ||
| 2069 | 16.35 | 13.23 | -3.12 | ---- | -0.93 | -0.05 | 0.87 | ||
| 2070 | 16.39 | 13.23 | -3.16 | ---- | -0.93 | -0.05 | 0.88 | ||
| 2071 | 16.43 | 13.23 | -3.20 | ---- | -0.94 | -0.05 | 0.88 | ||
| 2072 | 16.47 | 13.24 | -3.23 | ---- | -0.95 | -0.05 | 0.89 | ||
| 2073 | 16.49 | 13.24 | -3.26 | ---- | -0.96 | -0.05 | 0.90 | ||
| 2074 | 16.51 | 13.24 | -3.27 | ---- | -0.97 | -0.06 | 0.91 | ||
| 2075 | 16.52 | 13.24 | -3.28 | ---- | -0.98 | -0.06 | 0.93 | ||
| 2076 | 16.52 | 13.24 | -3.28 | ---- | -1.00 | -0.06 | 0.94 | ||
| 2077 | 16.50 | 13.24 | -3.26 | ---- | -1.02 | -0.06 | 0.97 | ||
| 2078 | 16.48 | 13.24 | -3.24 | ---- | -1.05 | -0.06 | 0.99 | ||
| 2079 | 16.44 | 13.24 | -3.20 | ---- | -1.08 | -0.06 | 1.01 | ||
| 2080 | 16.40 | 13.23 | -3.17 | ---- | -1.11 | -0.06 | 1.04 | ||
| 2081 | 16.36 | 13.23 | -3.13 | ---- | -1.14 | -0.07 | 1.08 | ||
| 2082 | 16.33 | 13.23 | -3.10 | ---- | -1.18 | -0.07 | 1.11 | ||
| 2083 | 16.29 | 13.23 | -3.06 | ---- | -1.22 | -0.07 | 1.15 | ||
| 2084 | 16.26 | 13.23 | -3.03 | ---- | -1.27 | -0.07 | 1.20 | ||
| 2085 | 16.23 | 13.22 | -3.01 | ---- | -1.32 | -0.08 | 1.24 | ||
| 2086 | 16.21 | 13.22 | -2.98 | ---- | -1.37 | -0.08 | 1.29 | ||
| 2087 | 16.18 | 13.22 | -2.96 | ---- | -1.43 | -0.08 | 1.35 | ||
| 2088 | 16.16 | 13.22 | -2.94 | ---- | -1.49 | -0.09 | 1.41 | ||
| 2089 | 16.14 | 13.22 | -2.92 | ---- | -1.56 | -0.09 | 1.47 | ||
| 2090 | 16.12 | 13.22 | -2.91 | ---- | -1.62 | -0.09 | 1.53 | ||
| 2091 | 16.10 | 13.22 | -2.89 | ---- | -1.69 | -0.10 | 1.60 | ||
| 2092 | 16.08 | 13.22 | -2.86 | ---- | -1.76 | -0.10 | 1.66 | ||
Summarized Estimates
| Proposal | Change from Current Law | ||||||||
|---|---|---|---|---|---|---|---|---|---|
| Years | Cost rate |
Income rate |
Actuarial balance |
Year of reserve depletion1 |
Cost rate |
Income rate |
Actuarial balance |
||
| 2017-2091 | 16.01% | 13.80% | -2.21% | 2035 | -0.65% | -0.04% | 0.61% | ||
1 Under current law, the year of Trust Fund reserve depletion is 2034. |
|||||||||
Based on Intermediate Assumptions of the 2017 Trustees Report.