A House committee has approved a bill that would allow federal employees to phase into retirement by working part-time and collecting a partial annuity, while a Senate panel has brought out a budget plan that calls for making federal retirement benefits less generous.

The bill approved Wednesday by the House Oversight and Government Reform Committee with bipartisan support mirrors language passed by the Senate last month as part of a transportation bill that is now stalled.

Under current law, the salaries of federal retirees who return to work for the government are reduced by the amount of their annuities, with some exceptions allowing for full payment of both. The phased retirement plan, which the Obama administration has proposed several times, would allow retirees to work one to four days a week, drawing a proportionate salary and a proportionate annuity.

The plan expects that phased retirees would spend a fifth of their time mentoring younger employees, and that savings of more than $460 million over 10 years would be achieved by not hiring full-time replacements and by paying only partial annuities.

Employees would like to work part time, and we would like them to be able to, said committee Chairman Darrell Issa (R-Calif.). He said phased retirement is a common practice in the private sector and noted that under the bill, it would be voluntary for federal retirees and available only at agencies discretion.

Currently, many federal employees retire from government service on a Friday and come back on a Monday either as a rehired annuitant or as a contractor, he said. However, the exceptions allowing both a full salary and full retirement benefits are rare, and if you tell people that if they keep working they only get half-pay or quarter-pay, youre effectively telling them to retire now.

The panels ranking Democrat, Rep. Elijah E. Cummings (Md.), said, This bill will enable employees to ease into retirement and enable agencies to benefit from the institutional knowledge of their most senior employees.

The committee accepted an amendment that would allow employees to deposit in their Thrift Savings Plan (TSP) accounts the value of unused annual leave they receive upon separation or retirement.

The lawmakers also approved a bill that would require new standards for customer service at federal agencies and make compliance with those standards part of employees performance evaluations, and a bill that would clarify that TSP accounts are subject to federal tax levies, an issue that has been in dispute.

In the Senate, a plan offered by Budget Committee Chairman Kent Conrad (D-N.D.) contains several employee-related provisions based on proposals made by the Simpson-Bowles deficit-reduction commission in 2010.

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Bill for phased retirement moves in House