GovExec Daily: What the TSP Changes Mean For Feds

Ross Gianfortune
This is GovExec Daily, where we bring you the federal stories that really matter.  It's June 8, 2022. I’m Ross Gianfortune.

Three Republican Senators last week announced that they had lifted their holds that had made it more difficult for President Joe Biden’s nominees to the Federal Retirement Thrift Investment Board to move forward. 

At the core of the objections was concern that the nominees would revisit a controversial proposal to change the index upon which the TSP’s I fund is based to an index that would include more interment in Chinese business. The Senators wrote in a letter that they were concerned about the possibility of the TSP investors being exposed to fraud, financial irregularities or other risks with such investments.

The holds came off after the TSP board nominees committed to being “highly skeptical” of changes that would introduce  Chinese investments to the TSP. The removal of the holds comes as the TSP transitions to a new recordkeeping service provider. According to TSP spokespeople, the new system will be easier for investors to monitor and make changes to their accounts, but users have reported some problems with account access.

GovExec Senior Correspondent Erich Wagner covers the federal workforce. After a short break, he’ll join me to discuss the TSP news and other stories that he has been covering.

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Ross Gianfortune:
The TSP is an integral part of many federal employees’ personal financial lives. In April three Senators placed holds on four of Joe Biden’s four nominees to the Federal Retirement Thrift Investment Board who have advanced out of committee. Last week, the Senators announced that they had lifted their holds.

GovExec Senior Correspondent Erich Wagner covers the federal workforce. He joins me now to discuss the TSP news and other stories that he has been covering. Welcome back to the program.

Erich Wagner:
Thanks for having me.

Ross Gianfortune:
So like I said, a group of senators lifted their holds on some of the TSP board nominees. What does this mean for the board? And more importantly, what does it mean for tsp investors?

Erich Wagner:
Sure. So yeah, these senators had placed a hold on these nominees. Basically, they're a bunch of China hawks, and they had been worried about the TSP board potentially shifting the way that the AI fund is invested to track a different index fund that currently is, which would include Chinese companies. This was an issue during the Trump administration, the Trump administration basically put political pressure on the board at that time to abandon a plan to do that. And since then, the board has said there are no plans to revisit that at this time. But they wanted to get a commitment from these nominees, that they would continue that path, what it means basically, now going to be a lot easier to confirm most of these nominees in the Senate. You know, the polls are not they don't block things completely, but it makes it a lot more time consuming for the Senate to move forward on them. So that's out of the way. As far as what it means for participants, you know, probably you won't see a whole lot of change. You know, there's there's it's not like the board is vacant right now. People are still serving holdover terms, until these new members are confirmed. But yeah, it seems like we won't see a any changes to the iPhone anytime soon.

Ross Gianfortune:
So it's generally business as usual for tsp investors, except the transition, they tsp moved to a new service provider over the last few weeks. What did that entail? And more importantly, how are users finding it?

Erich Wagner:
Sure. So this is a project that's been years in the making, they hired a new vendor to conduct the record keeping services. And with that comes a lot of new features, there's going to be there's a more secure login situation. There's now a mobile app that people can use to, you know, monitor their investments, change how they're investing in the TSP, and even do things like take images of like rollover checks, and submit them electronically and sign documents electronically. And there's also access to round 5000 mutual funds, if you so choose. That said, the transition has been a painful one, a lot of participants have had issues getting through the initial login process, because you have to basically recreate your account. Under the new login system, that's caused a lot of problems. A lot of people are having trouble with these image issues, and basically have been sort of kicked to a will will snail mail you a one time passcode. But that could take, you know, a week or two. And, you know, as a result of all of this call volumes at their call center are through the roof. And so people are stuck on hold for hours trying to get help, or losing connection altogether. tsp said they are working on these issues. They, you know, they're dealing with the call center stuff as best they can. And they are working on issues with the website and the login system right now. And beginning. To Tuesday, yeah. So yesterday when this comes out, people who have been kicked to that one time passcode thing that gets mailed can opt out of that and sort of restart the process over again, so that they're not basically locked out of their account for weeks.

Ross Gianfortune:
Yeah, anyone who's had to deal with any of the any financial move overs, a 401 K, a retirement plan, those kinds of things, knows the pain of this kind of thing. I'm sure it was inevitable. But certainly you would think especially around the holidays, because if I recall, it was around Memorial Day. That makes things even harder, because you have shorter staff on the support side of things. Speaking of staff, the employees at the Bureau of Land Management headquarters, here around DC, have voted to unionize. What's the story here the backstory and doesn't mean anything for other agency a choose?

Erich Wagner:
Oh, yeah. Um, so the backstory here is a few years ago, during the Trump administration, they tried to move the Bureau of Land Management headquarters out west to Grand Junction, Colorado, rather controversially, they succeeded in doing that, and moved, folks out west led to a huge staff Exodus, because, understandably, people don't necessarily want to completely uproot their lives. And then, last year, you know, after the President Biden took office, they announced that they're moving back. So, you know, this really prompted this whole sort of ping pong thing of where the headquarters is going to be located led to a, you know, people saying, Hey, we should have a say over these massive changes in our working conditions that are happening seemingly constant constantly. And when I spoke with the the organizers, you know, they said this was sort of the spark, but like there been, you know, underlying issues with, you know, wanting to have a sound working conditions, wanting to be able to be sort of an advocate for the agency, as its responsibilities and mission have sort of expanded with Under, but their budget has not correspondingly increased. So they wanted to be a partner with the agency advocating for additional funding to be able to staff up and meet their these growing responsibilities. As far as what it means for other agencies, I'm not so sure that it is that big of a bellwether on that front. BLM is interesting is in that it is one of the largest agencies that remains mostly non unionized. So I think the bigger question is, how this might influence other offices in BLM to start looking at organizing themselves. They went with,

Ross Gianfortune:
are they organized with NTEU? What has NTEU said about the move?

Erich Wagner:
Well, you know, they, they are obviously happy to see another bargaining unit in the federal government organized, and they're happy to see it. 

Unknown Speaker  
Yeah, I imagine it's always good to have more people under the tent. When you are part of that group, we'll end on something that I think a lot of people were shocked about. I know when I spoke to some folks about it, in my personal life about this story, their minds were blown. White House interns were not paid. And now they are what took so long. And what, what does this entail now?

Erich Wagner:
Oh, as you know, you got into journalism, I think a lot of industries have not paid interns basically, as long as they can. And the federal government is kind of no exception until at least until recently, obviously, unpaid internships, as recently as a decade ago was kind of commonplace in a lot of industries. And it hasn't been until these last few years that people have really noticed that that is a problem, not only when it comes to, you know, fair treatment of workers. But also, it's a big diversity issue. Because when you have unpaid internships, the people who can, who end up being interns are the people who can afford to do so and better is primarily affluent white people. But yeah, this has been a big push of the Biden administration and some Democrats in Congress for the better part of six months to a year now, you know, OPM had been passing regulations last year, making it easier to pay interns making it easier to hire college students, as part time workers that could then could be converted to permanent full time jobs once they graduate. So yeah, this is just another step in the administration's effort to sort of rejuvenate what has been across government kind of a failed recruitment method, you know, internships were a very small piece of the recruitment strategy recently. And as a result, you know, we hear all the time about how old the federal workforce is compared to the private sector.  

Ross Gianfortune: 
We certainly talked on this show a lot about hiring and retention, particularly for younger workers and paying them never hurts. You noted. The sort of changing tides I know I did more than one internship that was for quote unquote, exposure and experience and that it's gotten me here. So take that for what it is. But certainly, if you're in the White House, you would think that just the key fob is not enough. Probably doing pretty important work, even if it's just some of the most menial work there. Eric, thanks for being on the show with us. 

Erich Wagner:
Thanks for having me.

Ross Gianfortune:
Thanks for listening to GovExec Daily. Our show was produced by Adam Butler and hosted by me, Ross Gianfortune. We want to thank Erich Wagner for joining the program. Our music is the song “Signals” by Catfish Dancing. Be sure to rate, review and subscribe on Apple Podcasts or Google Podcasts or wherever you get your podcasts. Check us out in the Clubhouse app by searching GovExec Daily. You can email us any feedback at podcast @ govexec.com or hit us on Twitter @ Govexec. 

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