The Chairman of the House Ways and Means Social Security Subcommittee, Rep. Earl Pomeroy (D-ND), has introduced H.R. 5987, The Seniors Protection Act of 2010, that would provide a one-time $250 payment to retired and disabled Social Security and SSI beneficiaries (and to veterans) if there is no cost-of- living adjustment (COLA) announced for 2011.
Any COLA for 2011 will be determined in October by comparing the change in the Consumer Price Index (CPI-W) from the third quarter of 2009 to the third quarter of 2010. It is likely that there will be no increase. There was a large increase in energy costs in the summer of 2008, which resulted in a 5.8% COLA, paid starting in January 2009. However, prices dropped in the fall of 2008 and have not regained the level of the third quarter in 2008. As a result, there was no COLA for 2010 because there was no increase from the third quarter of 2008 to the third quarter of 2009.
If there is no COLA for payments in 2011, it will be the first time since automatic COLAs began that Social Security and SSI benefi ciaries did not receive a benefit increase for two consecutive years.