Congress Looks to G Fund Rate Reduction to Offset Highway Bill Funding


As the Senate prepares to consider a highway funding bill, we have learned that one of funding mechanisms under consideration to offset the costs of the highway bill is to lower the rate of return on the G Fund. The G Fund rate of return uses a formula identical to one used by Social Security to fund its disability program. Some Members of Congress are interested in lowering the rate of return on the G Fund and using those savings to fund other programs. 

NTEU strongly opposes such a move. Lowering the rate would, even in the words of the Federal Retirement Thrift Investment Board, render the G Fund useless. It would eliminate the only safe harbor fund in the TSP. Almost 4.3 million TSP participants have some money in the G Fund. It makes no sense to so drastically change this retirement fund to pay for highway funding. 

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