The FED Weekly 8-14 Mar 2026 (Episode 41)
Download MP3Welcome to the FED Weekly for 08/2026, your essential weekly briefing on the policies and proposals shaping your career, your benefits, and your retirement. Whether you're a current federal employee navigating changes in the civil service or a retiree keeping a close watch on your hard earned pension and health care, this is your source for the latest news from Capitol Hill and the Executive Branch. Each week we cut through the noise to bring you the critical updates on budget negotiations, pay raises, workforce policies, and the legislative battles that directly impact the federal community. Let's get you up to speed on what happened this past week. Issues that affect current and retired federal workers.
Speaker 1:The most pressing and explosive news of this week concerns the security of the personal data of nearly every American. On the 03/10/2026, a whistleblower report was released containing shocking allegations regarding the Department of Government Efficiency or DOGE and its handling of sensitive Social Security Administration data. According to the report, a software engineer previously associated with Doge allegedly copied files containing personally identifiable information or PII for hundreds of millions of Americans onto a personal thumb drive. Even more alarming were the allegations that this individual may have retained remote access to the Social Security Administration's internal systems even after leaving government service with the reported intent to use this data for personal gain or private employment. Representative James Walkinshaw of Virginia's 11th District issued a formal statement on the 03/10/2026 demanding immediate accountability for what he described as a stunning breach of the safeguards meant to protect financial security and privacy.
Speaker 1:The fallout continued on the 03/12/2026 when House Social Security Subcommittee ranking member John Larson and Ways and Means Committee ranking member Richard Neal set a formal demand for answers to Social Security Administration Commissioner Frank Bisignano. The lawmakers expressed a dangerous lack of oversight and criticized the Commissioner for earlier comments that seemingly minimized the risks associated with Doge's access to federal databases. For current and retired federal employees, this breach is of paramount concern as their own employment and retirement records are deeply intertwined with the Social Security Administration's infrastructure. The potential exposure of this data represents a second order risk of identity theft and financial fraud on a scale previously unseen in the federal sector. While the data security crisis unfolded, the Federal Retirement Thrift Investment Board provided a clearer picture of the financial landscape for the Thrift Savings Plan, or TSP.
Speaker 1:On the 03/12/2026, the board released performance data for the month of February 2026, revealing a month of modest gains and localized volatility. The standout performer was the International Stock Index Investment Fund or I Fund, which surged by 6.05% in February bringing its total year to date growth for 2026 to 12.34%. This growth was driven by unexpectedly strong performance in overseas markets providing a significant boost to those with high international exposure. Conversely, the Common Stock Index Investment Fund or C Fund was the only offering to lose value in February falling 0.76. For long term investors, this decline in the S and P five hundred Tracking Fund was a reminder of the market's sensitivity to domestic policy shifts.
Speaker 1:The Small Cap Stock Index Investment Fund or S Fund posted a gain of 1.08% while the Fixed Income Index Investment Fund rose 1.63%. The Government Securities Investment Fund which is designed to protect capital grew by its statutorily mandated rate of 0.33% bringing its 2026 growth to 0.7%. For the millions of participants in the life cycle funds, the results were consistently positive but varied by the target retirement date. The L Income Fund, tailored for those already in retirement, increased by 0.82% in February. Funds with longer horizons, such as L2055 through L2075, all posted identical gains of 1.82% for the month.
Speaker 1:This performance data released during the week of eight-fourteen March twenty twenty six underscores the importance of the TSP as the cornerstone of federal retirement, especially as participants prepare for the launch of a new Roth In Plan Conversion feature later this year, which will allow for the movement of traditional balances into Roth accounts. Another critical issue affecting both current and retired workers is the evolving relationship between the cost of living adjustment or COLA and the rising cost of healthcare. On thirteen March twenty twenty six, analysts highlighted that while Social Security and Civil Service Retirement System benefits saw a 2.8% increase for 2026, this gain is being almost entirely offset for many by a sharp 10% increase in Medicare Part B premiums. The average Social Security benefit now stands at $2,075 per month, but after the new Part B premium of $202.9 is withheld, the take home amount is significantly lower than many anticipated. While the hold harmless provision prevents benefit checks from actually decreasing, the interplay between these two figures means that for millions of federal families the 2026 COLA has provided little to no real increase in purchasing power.
Speaker 1:On the legislative front, several bills moved into the spotlight during the week of March 2026. On the 03/10/2026, Representative James Walkinshaw and Senator Brian Schatz introduced the Federal Adjustment of Income Rates or FARE Act. This legislation is a direct response to the administration's recent 1% pay raise, which lawmakers argue is insufficient to keep pace with inflation. The Fair Act proposes a 4.1 pay increase for federal employees in the 2027 calendar year, a move supported by major unions like the American Federation of Government Employees and the National Treasury Employees Union to close the growing pay gap between the public and private sectors. Additionally, current and retired workers are closely following the True Shutdown Fairness Act, also discussed in congressional circles this week.
Speaker 1:This bill, introduced by Representative Walkinshaw and a coalition of House Democrats, aims to protect federal workers, service members, and contractors during any potential government shutdown in the 2026 fiscal year. Specifically, it would mandate that all employees are paid during a lapse in appropriations and, crucially, prohibit the administration from using a shutdown as a smokescreen to carry out reductions in force or other mass firings. For the federal community, this legislation represents a critical defensive measure against the recurring threat of fiscal instability. Finally, in terms of broader government transparency, a report from the Government Accountability Office on the 03/09/2026 found that the Federal Program Inventory, a centralized list of all government programs and their performance metrics, remains incomplete and inaccurate. Simultaneously, another report on 03/09/2026 revealed that only about one third of the most viewed Federal websites meet legal accessibility requirements for people with disabilities.
Speaker 1:These findings suggest that despite the administration's focus on efficiency, fundamental aspects of government accountability and public access are lagging behind statutory mandates. Issues that affect retired federal workers For the nation's retired federal employees, the week of 08/2026 brought a mix of administrative challenges and new insights into the long term sustainability of their benefits. A significant report published on the 03/12/2026 by expert Tammy Flanagan highlighted a persistent and troubling retirement gap facing women in the federal service. The analysis detailed how career interruptions for caregiving, lower lifetime earnings, and the fact that women statistically live longer all contribute to inferior retirement outcomes compared to their male colleagues. This report has sparked a renewed discussion among retiree advocacy groups about whether the current Federal Employees' Retirement System structure adequately supports nonlinear career paths.
Speaker 1:Administratively, many retirees reported significant frustration this week regarding tax season preparations. On the 03/10/2026, Representative Walkinshaw noted that his office has been flooded with complaints from retirees who have yet to receive their ten ninety nine R forms from the Office of Personnel Management. These forms are essential for reporting pension income to the Internal Revenue Service and the delay has left many retirees unable to file their taxes on time. This issue is compounded by a reported doubling of the retirement application processing backlog over the last four months, a development that suggests the Office of Personnel Management is struggling to handle the volume of new retirements while simultaneously implementing the administration's sweeping policy changes. Related to financial management in retirement, new data released on 11/2026 clarified the impact of the 2026 pay raise on those who recently transitioned out of the workforce.
Speaker 1:For employees who retired just before 01/11/2026, the date the new salary rates took effect, there is an important update regarding lump sum payments for unused annual leave. Under Office of Personnel Management guidelines, these payments are calculated based on the pay the employee would have received had they stayed on the job. This week retirees were informed that if their leave period extended into the new pay period starting 01/11/2026 a portion of their lump sum payment should reflect the 1% salary increase though this adjustment may be processed separately and arrive later than the initial payout. Working retirees also received a critical reminder this week regarding earnings limits for the 2026 calendar year. The Social Security Administration updated its guidance for beneficiaries who are under the full retirement age and continue to work.
Speaker 1:For 2026, the earnings limit is $24,480 The agency will deduct $1 from benefits for every $2 earned above this limit. For those reaching their full retirement age in 2026, the limit is significantly higher at $65,160 with a one for three reduction for earnings above that threshold until the month they reach full retirement age. These limits are particularly relevant for FERS retirees who receive the Special Retirement Supplement as the same earnings test is used to determine if their supplement should be reduced or eliminated. On the 03/12/2026, the Washington Department of Retirement Systems also provided an update on cost of living adjustments for 2026 which serves as a point of comparison for federal retirees. While state level plans like the Law Enforcement Officers and Firefighters Plan one will see adjustments take effect on the 04/01/2026, Federal retirees are currently navigating the disparity between the Civil Service Retirement's 2.8% COLA and the FERS 2% COLA.
Speaker 1:This disparity, often called the FERS Diet COLA, has led to increased support this week for the Equal COLA Act which would ensure that both retirement systems receive the same inflation adjustment regardless of the economy's performance. Finally, retirees are keeping a close watch on the Consumer Price Index data released this month. On the 03/12/2026, the National Association of Active and Retired Federal Employees reported that the consumer price index for urban wage earners and clerical workers rose by 0.47% in February 2026. This index is the primary metric used to calculate the 2027 COLA and the current upward trend suggests retirees may be in line for another significant adjustment next year if inflation remains sticky. However, as noted earlier this week, the benefit of these adjustments is often a wash when paired with the rising costs of Medicare and prescription drugs.
Speaker 1:Issues that affect current federal workers. The most significant developments for the active federal workforce occurred on the 03/09/2026, a date that will likely be remembered as the beginning of a new era for civil service protections. This was the official effective date for the implementation of Schedule Policy, Career, or Schedule PC. Under this new classification, tens of thousands of career employees, primarily those in policy making, policy determining, or policy advocating roles, have been converted from the competitive service to the accepted service. This move effectively renders these employees at will meaning they serve at the pleasure of the administration and lose the robust due process rights that have historically protected them from arbitrary or politically motivated firing.
Speaker 1:Simultaneously, on the 03/09/2026, the Merit Systems Protection Board officially revoked its own authority to hear appeals from employees regarding these conversions. The Board stated that it no longer has jurisdiction because the Office of Personnel Management rescinded the regulatory basis for such appeals, which had been put in place by the previous administration, to block exactly this type of policy. This means that for employees whose positions were converted this week, there is no longer an administrative pathway to challenge the move through the Merit Systems Protection Board. Instead, any legal challenge must now be fought in the federal court system. The administration's rationale for this shift was articulated by Office of Management and Budget Deputy Director Eric Ueland during a government efficiency conference this week.
Speaker 1:He suggested that making it easier to fire federal workers would actually liberate them to perform their jobs better and that at will organizations offer more empowerment for employees to effectuate change without being held back by stultifying rules. This perspective stands in stark contrast to the views of federal unions and lawmakers like Representative Walkinshaw, who on 05/2026 described these changes as an attempt to rig federal firings and traumatize a workforce that prides itself on nonpartisan expertise. Adding to the tension, the Office of Personnel Management on tenth March twenty twenty six published a detailed proposal to overhaul the rules for reductions in force or RIFs. The proposed rule would make performance ratings the primary factor in determining who is retained during a layoff, significantly diminishing the importance of seniority and length of service. Under the new scoring system, an employee would receive twenty additional years of service credit for an outstanding rating, sixteen years for exceeds fully successful, and twelve years for a fully successful rating.
Speaker 1:While the administration argues this will help agencies retain their best performers during restructuring, the Partnership for Public Service issued a strong opposition on the 03/12/2026 arguing that the rule creates conditions for politically driven removals and strips employees of meaningful due process. They noted that the Office of Personnel Management lacks the institutional capacity and structural independence to fairly adjudicate the appeals that would arise from such a system. In the midst of these structural changes, current workers at two agencies saw major legal victories this week. On the 03/12/2026, an independent arbitrator ruled that the Social Security Administration must restore telework and remote work abilities for many of its employees. The arbitrator found that the agency had illegally repudiated its contract with the American Federation of Government Employees when it forced most workers back to the office full time in March 2025.
Speaker 1:Then on the 03/13/2026, a federal judge ordered the Department of Veterans Affairs to restore collective bargaining rights for more than 320,000 workers, a significant reversal for an agency that has been at the center of the administration's efforts to curtail union power. However, other agencies continue to face operational turmoil. At the Internal Revenue Service, a report on 11/2026 detailed how the agency is struggling to handle the 2026 tax season after losing 27% of its workforce to layoffs and voluntary departures initiated by the Department of Government Efficiency. The agency has reportedly canceled some planned layoffs and is now scrambling to rehire staff for mission critical areas in technology and taxpayer experience. Staff who were previously told they would be laid off are being reassigned to different roles, leading to a climate of considerable uncertainty as the agency tries to rebuild its capacity in real time.
Speaker 1:At the Environmental Protection Agency, reports on 12/2026 indicated that the workforce is struggling to manage its grants workload after significant personnel cuts last year. Meanwhile, at the Department of Homeland Security, the week ended with a brewing scandal at the Cybersecurity and Infrastructure Security Agency. On the 03/13/2026, lawmakers called for an independent investigation after reports surfaced that the agency's former acting director had failed a second polygraph examination. This has raised serious questions about the vetting of political appointees and whether high level intervention was used to bypass standard security protocols. Finally, current employees should be aware of a significant ruling from the US.
Speaker 1:Court of Appeals for the Federal Circuit on the 03/10/2026 regarding attorney fees. In a case involving a Department of Veterans Affairs employee, the court took a broad view of what it means to be a prevailing party. It ruled that even if an agency's appeal becomes moot, for example, because the agency eventually provides the requested back pay or reinstatement, the employee is still entitled to have their attorney fees and court costs reimbursed. This is a major win for employees who must fight long legal battles against their agencies as it ensures they can recover their legal expenses as long as they were granted relief on the merits of their case at some point in the process. And that's a wrap on this week's Federal Workforce Roundup.
Speaker 1:The landscape for federal employees and retirees is constantly shifting, with major decisions being made about everything from pay and job security to retirement benefits and the very structure of the civil service. Staying informed is your best tool. Be sure to subscribe wherever you get your podcasts so you never miss an update. Thanks for tuning in. We'll be back next week to track the latest developments and what they mean for you.
Speaker 1:Until then, stay engaged and be well.
