Social Security Makes Even More Public Service Cuts

Agency cites budget pressures as it closes offices earlier and suspends mailing of paper statements.

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More than 56 million Social Security recipients will soon find out how much their monthly payments will go up next year.
More than 56 million Social Security recipients will soon find out how much their monthly payments will go up next year.

Citing budget pressures, the Social Security Administration (SSA) has once again suspended mailing paper statements and will begin next month to close its more than 1,200 field offices 30 minutes earlier each day. Next January, the offices will begin closing at noon each Wednesday.

Most federal agencies began their 2013 fiscal year on October 1 with budgets that were only six-tenths of 1 percent greater than in fiscal 2012. This continuing resolution (CR) was agreed to by President Obama as part of a deal to avoid triggering debt-ceiling problems until next spring. "Under the current CR, we are operating on significantly less funding than either the agency or President Obama requested," Social Security spokeswoman Kia Green told U.S. News in an e-mail.

"Beginning November 19, 2012, we will close Social Security field offices to the public 30 minutes early each day," she wrote. "For example, a field office that is usually open to the public Monday through Friday from 9:00 am to 3:30 pm will close daily at 3:00 pm; and beginning January 2, 2013, we will close Social Security field offices to the public at 12:00 pm on Wednesdays." Staffers will not lose normal hours, but will be much less likely to require overtime to finish helping members of the public who arrive at the offices late in the day.

[Read: 12 Ways to Increase Your Social Security Payments.]

"People are not going to get their calls answered properly, and they're going to show up at [Social Security] offices and find them closed," says Timothy Gearan, senior legislative representative at AARP. "That's going to cause a lot of trouble."

Citing Social Security statistics, Gearan says more than 180,000 people a day visit Social Security offices and nearly 450,000 a day call the agency for assistance. Both numbers are rising due to increasing claims spurred by the recession plus the surge of retiring baby boomers.

Gearan says the SSA has been victimized by continuing legislative gridlock between Congressional Republicans and Democrats. The department's funding for operational expenses is paid from discretionary appropriations, not from the independent Social Security trust funds. Current agency administrative spending is about $11.8 billion a year, Gearan says. "Social Security was spending just about that amount two years ago, and we know we've had a heck of a lot more people coming through" since then to use agency services. The agency's budget "is about a billion dollars below where we think it should be."

"They've lost 9,000 employees over the past three years," he says, "and we expect them to lose another 1,000 jobs this year ... They're doing wonderful work but they're just caught in a bind between the two parties in Congress."

[Read: The Case for Fixing Social Security Right Now.]

The SSA did not respond to requests from U.S. News to provide more details about its budget situation. Its latest cutbacks were not publicly announced but began to be picked up by news outlets earlier this month after complaints were issued by the American Federation of Government Employees, which represents Social Security employees.

The blog of the union's Social Security Council blamed the action on Social Security Commissioner Michael Astrue. It quoted council president Witold Skwierczynski as saying, "This decision is a deliberate attempt by Commissioner Astrue to deny Social Security beneficiaries and the public access to critical information they need to successfully navigate the system ... 46 Social Security offices have been closed over the past 21 months, field office staff have been cut, and over 300 contact stations around the country have been closed. The pattern is clear, SSA is saying to the public, 'We are getting out of the service business, you're on your own.'"

As of August, the agency says that more than 56 million Americans were receiving Social Security benefits for retirement and disability. Nearly 160 million working people in 2012 will make payroll tax payments to the agency.

In deciding to once again end the mailing of paper statements, the agency rekindled criticism of its original March 2011 decision to save roughly $70 million a year by ending the annual mailing of paper-based statements to more than 150 million Americans. Instead, it said it would provide online statements. Critics say older Americans and people with low incomes are the two groups most reliant on Social Security and also the least likely to have Internet access.

The annual statement reports contain a historical record of a person's payroll taxes and year-by-year earnings record, and projections of how much they would receive in retirement benefits at various possible ages at which they are eligible to claim benefits. Retirement experts say it is the single most valuable communication that people receive about Social Security, which has become the dominant source of retirement income for most Americans.

[Read: Social Security Will Soon End Paper Checks.]

The agency said at the time that it would send paper statements to anyone more than 60 years old and to anyone who requested them. But it took nearly a year before these mailings resumed last February. Through the end of June, the agency said, 6.7 million statements had been mailed to people age 60 and older and that only 5,500 other people had requested paper statements. It also said that a million individuals had signed up for online statements in the first four months of their availability. Those statements are available at