Now that Congress has punted on any serious measures to reform the Social Security System, critics continue to question the accuracy of the Social Security Administration’s funding projections. The concern is that the SSA’s figures make the retirement and disability trust funds appear to be healthier than they actually are. One would think that because Social Security is the government’s largest program that extra care would be taken by the agency to ensure that their figures are realistic.
The program is funded by payroll taxes and income taxes on benefits and these proceeds pay benefits and administrative costs. Further complicating the issue is the fact that more and more members of the Baby Boomer generation are retiring and this is putting a strain on the system. The result is a widening gap between revenue going into the funds and the amount of money being paid out.
In 2015, about 60 million people received benefits totaling $877 billion. Of those recipients, 40 million were retirees who received an average of $1,335 per month. The programs’ Board of Trustees has released reports of different projections, but the long and short of it is that the asset reserves of the retirement and disability funds will be depleted by 2034.
As for the accuracy of the projections, a recent independent study outlined a number of problems with the Agency’s methods. One is that The SSA does not meet the same standards in scientific evaluation procedures that other government agencies and private sector businesses employ. The errors in forecasting most likely occurred because the agency lacks formal statistical methods used to create forecasts.
There are also other problems plaguing the Social Security Disability Insurance Program, and long-term funding has still not been resolved. Currently, more than 10 million Americans are now on SSDI, at an annual cost of more than $140 billion. Some contend that the SSDI eligibility standards need to be updated as they currently rely on data that is 30 years old. In any event, the budget compromise struck between the White House and Congress last December, was only a short-term fix.
Given the fact that Congressional lawmakers have oversight over the Social Security Administration, these elected officials need to insist on greater transparency and accuracy, since their policy decisions are based on the administration’s forecasts. In the meantime, if you have become disabled and are unable to work, a qualified attorney can help you secure disability benefits.