The Ethics Reform Act of 1989 established automatic annual cost-of-living adjustments (COLAs) for members of Congress, tied to changes in private sector wages. However, Congress has voted regularly to block these automatic COLA increases, effectively freezing salaries for all members.
Using data from the Congressional Research Service (CRS) on the annual rates of the blocked COLAs, we calculate what the annual salaries for all members of Congress would have been if none of the COLA increases were blocked.
Without these freezes, the base salary for rank-and-file members of Congress would now be $274,900 in 2024, 58 percent higher than the current salary of $174,000. Salaries for leadership positions in the House and Senate would also see sizable increases.
Taxpayer Savings for Congressional Salary
By blocking these pay raises, Congress has saved taxpayers a total of $603 million in additional salary costs through 2024. These savings are significant, especially given the rising national debt and calls for fiscal responsibility in government spending.
Taxpayer Savings on Congressional Pension Liabilities
Salary freezes have also limited taxpayer burdens for congressional pensions. Members of Congress with at least five years of service are eligible for a pension. The starting pension amounts are calculated based on the average of their three highest salary years. Freezing salaries has curbed the increase in pension payments, providing long-term savings for taxpayers. While pension formulas are publicly known, estimating savings from blocked COLAs is difficult due to the lack of detailed individual data from the Office of Personnel Management.
CRS does report that as of October 2022, 261 former members of Congress under the Civil Service Retirement System (CSRS) were receiving an average annual pension of $84,504, and 358 enrolled in the Federal Employees’ Retirement System (FERS) were receiving an average pension of $45,276.
For example, if all COLAs had been enacted:
A member retiring in 2000 under CSRS would have received a starting pension that was $8,200 higher. Over five years, the cumulative pension payout would have been $42,800 more.
Similarly, a member retiring in 2004 under FERS would have received a starting pension that was $6,900 higher, with a cumulative five-year pension payout increase of $36,300.
Freezing COLAs has significantly contained pension costs, likely saving taxpayers hundreds of millions of dollars in addition to the direct savings in congressional salary.