Photo: Courtesy of pccapitalist
In the latest indication of the United States Postal Service’s dire financial straights, the Associated Press is reporting that the agency will will stop contributing to the Federal Employees Retirement System (FERS).The move will free up $800 million in badly needed cash for the current fiscal year, the Postal Service said in a statement.
“We will continue to transmit to OPM employees’ contributions to FERS and also will continue to transmit employer automatic and matching contributions and employee contributions to the Thrift Savings Plan,” said Anthony Vegliante, chief human resources officer and executive vice president.
The Postal Service has cut over 100,000 career positions in the last four years, for a savings of $12 billion. Nevertheless, the agency ended the last fiscal year $8 billion in the red, and its outlook for this year is not much better.
In the statement, the Postal Service reasserted that it needs the authority to cut Saturday mail delivery as a way to close its budget gap —something Congress has been unwilling to give.
The good news is, the agency pension account currently shows a $6.9 billion surplus.
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