Department of the Treasury

Hold Pension & Payroll for One Day in ACH Interest Bearing Accou

In administering the provisions of law relating to pay, retirement and leave of absence, the federal government is required to ensure employees and retirees receive their paychecks on or before the second Thursday following each pay period. These provisions were enacted many years ago when payroll processes were far less efficient (cashiers, paper checks, mail, etc.).


Now that virtually all federal employees and retirees receive their paychecks electronically, pay is generally available by the second Monday following each pay period, which exceeds the requirement set forth in the payroll provisions by four days.


I am proposing that the federal government hold paychecks for one day each pay period and pension checks for two days each month in an Automatic Clearinghouse (ACH) interest bearing account. This will generate revenue in the amount of approximately $10,760,100 in revenue for federal civilian government paychecks per annum. Many publicly traded payroll providers and financial institutions generate revenue in this way. Imagine employing the same strategy for federal civilian pensions and/or social security. Now you are talking about some big bucks!



Total Annual civ fed sal / 365 X 26 X 1% = 10,760,100


- Total # Federal Civilian Full Time Workforce = 2,823,777

- Total # Federal Civilian Part Time Workforce = 2,527,149

- Total Federal Civilian Payroll March 2009 = 15,105,511,892



BY FUNCTION: March 2009:


1% interest rate (available @ many banks, American Express, Discover, etc.)



Idea No. 4943