Social Security Administration Commissioner Frank Bisignano said in an interview Monday that the entitlement program will be around for another 90 years as a key trust fund approaches insolvency.
Bisignano, who is also the IRS CEO, spoke with CNBC’s “Squawk Box” ahead of this week’s announcement of the 2027 cost-of-living adjustment (COLA) for Social Security benefits following the latest inflation data.
As SSA commissioner, Bisignano is one of the trustees of Social Security’s trust funds, and he was asked about potential reforms to the program to ensure its future solvency and said he expects the program will continue well into the future.
“This is a long journey. It’s 90 years old, and it’ll be around for another 90 years. The president has promised to protect and preserve and that’s what we’re doing,” Bisignano said.
SOCIAL SECURITY RECIPIENTS MAY GET BIGGER BENEFIT BOOST IN 2027
“We have a trust fund, so they have trustees, which I am one of. We have a president who is committed to this and lives by ‘protect and preserve’ and made it a mandate to me,” he said.
“Ultimately, it will be the White House and Congress and the trustees. But the job, when you have 30 million records that are wrong, is fix the place,” Bisignano added, explaining that SSA has cleaned up about 10% of the records in the Social Security file that were erroneous.
Bisignano was asked about reforms to shore up the finances of Social Security, such as raising the retirement age, and he acknowledged that there “will always be questions,” but opted not to discuss potential changes to benefits or the taxes that finance them.
SOCIAL SECURITY’S MAIN TRUST FUND FACES DEPLETION IN 2032, TRIGGERING BENEFIT CUTS
Social Security was created in 1935 and began operations in 1937, but over the ensuing decades it has come under financial pressure amid the changing demographics of the U.S. population.
The most recent report from the trustees projected that Social Security’s main trust fund will be depleted in 2032, which would lead to automatic benefit cuts for beneficiaries.
Once Social Security’s trust fund becomes insolvent, the program is required by law to cut benefits to match incoming payroll tax revenue. Based on the trustees’ estimate, Social Security would only be able to pay 78% of scheduled benefits in late 2032, amounting to an estimated benefit cut of 22%.
ONE TYPE OF SOCIAL SECURITY ADJUSTMENT COULD CUT THE 75-YEAR SHORTFALL IN HALF
Estimates of the size of the benefit cut vary. The nonpartisan Congressional Budget Office (CBO) projected benefits would be cut by an average of 28% per year from 2033 to 2036. CBO’s analysis noted that the process for cutting benefits isn’t outlined in federal law and that various methods would have a range of implications for the economy and federal budget.
The Committee for a Responsible Federal Budget (CRFB), a nonpartisan think tank, previously estimated a 24% benefit reduction that would mean a typical couple aged 60 who retires at the time of insolvency would face an $18,400 cut to annual benefits.
Social Security’s finances have deteriorated in recent decades as the share of workers to retirees drawing benefits from the entitlement program declined.
CLICK HERE TO DOWNLOAD THE FOX NEWS APP
SSA data shows that the ratio of covered workers to Social Security beneficiaries has fallen over time from 41.9 in 1945, to 16.5 in 1950, 5.1 in 1960, four in 1965 and dipped below three for the first time in 2010.
The aging U.S. population has also contributed to an uptick in federal spending on Social Security, which is the largest government program and saw spending increase 5% in the federal government’s fiscal year 2026.
Read the full article here
