employee will have acquired additional years of service, such additional years of service may be credited to him with the same effect as if no annuity had previously been awarded to him.

(b) An annuity shall be paid only if the applicant shall have relinquished such rights as he may have to return to the service of an employer and of the person by whom he was last employed; but this requirement shall not apply to the individuals mentioned in subdivision 4 and subdivision 5 of subsection (a) prior to attaining age sixty-five.

(c) An annuity shall begin to accrue as of a date to be specified in a written application (to be made in such manner and form as may be prescribed by the Board and to be signed by the individual entitled thereto), but

(1) not before the date following the last day of compensated service of the applicant, and

(2) not more than twelve months before the filing of the application.

(d) No annuity shall be paid with respect to any month in which an individual in receipt of an annuity hereunder shall render compensated service to an employer or to the last person by whom he was employed prior to the date on which the annuity began to accrue. Individuals receiving annuities shall report to the Board immediately all such compensated service.

No annuity under paragraph 4 or 5 of subsection (a) of this section shall be paid to an individual with respect to any month in which the individual is under age sixty-five and is paid more than $100 in earnings from employment or self-employment of any form: Provided, That for purposes of this paragraph, if a payment in any one calendar month is for accruals in more than one calendar month, such payment shall be deemed to have been paid in each of the months in which accrued to the extent accrued in such month. Any such individual under the age of sixty-five shall report to the Board any such payment of earnings for such employment or self-employment before receipt and acceptance of an annuity for the second month following the month of such payment. A deduction shall be imposed, with respect to any such individual who fails to make such report, in the annuity or annuities otherwise due the individual, in an amount equal to the amount of the annuity for each month in which he is paid such earnings in such employment or self-employment, except that the first deduction imposed pursuant to this sentence shall in no case exceed an amount equal to the amount of the annuity otherwise due for the first month with respect to which the deduction is imposed. If pursuant to the third sentence of this subsection an annuity was not paid to an individual with respect to one or more months in any calendar year, and it is subsequently established that the total amount of such individual's earnings during such year as determined in accordance with that sentence (but exclusive of earnings for services described in the first sentence of this subsection) did not exceed $2,400, the annuity with respect to such month or months, and any deduction imposed by reason of the failure to report earnings for such month or months under the fifth sentence of this subsection, shall then be payable. If the total amount of such individual's earnings during such year (exclusive of

earnings for services described in the first sentence of this subsection) is in excess of $2,400, the number of months in such year with respect to which an annuity is not payable by reason of such third and fifth sentences shall not exceed one month for each $200 of such excess, treating the last $100 or more of such excess as $200; and if the amount of the annuity has changed during such year, any payments of annuity which become payable solely by reason of the limitation contained in this sentence shall be made first with respect to the month or months for which the annuity is larger.

(e) SPOUSE'S ANNUITY.-The spouse of an individual, if—

(i) such individual has been awarded an annuity under subsection (a) or a pension under section 6 and has attained the age of 65, and

(ii) such spouse has attained the age of 65 or in the case of a wife, has in her care (individually or jointly with her husband) a child who meets the qualifications prescribed in section 5(1) (1) (without regard to the provisions of clause (ii) (B) thereof) of this Act.

shall be entitled to a spouse's annuity equal to one-half of such individual's annuity without regard to [section 3(a)(3), (4) or (5) of this Act] section 3 (a) (3), (4), (5), or (6) of this Act or pension, as in effect before 1970; but not more, with respect to any months, than 110 per centum of an amount equal to the maximum amount which could be paid to anyone, with respect to such month, as a wife's insurance benefit under section 202(b) of the Social Security Act as amended: Provided, however, That if the annuity of the individual is awarded under paragraph 3 of subsection (a), the spouse's annuity shall be computed or recomputed as though such individual had been awarded the annuity to which he would have been entitled under paragraph 1 of said subsection: Provided further, That, if the annuity of the individual is awarded pursuant to a joint and survivor election, the spouse's annuity shall be computed or recomputed as though such individual had not made a joint and survivor election: And provided further, That the spouse's annuity provided for herein and in subsection (h) of this section shall be computed without regard to the reductions in the individual's annuity under the first two provisos in section 3 (a) (2).

The spouse's annuity computed under other provisions of this section shall (before any reduction on account of age) be increased by 15 percent but not by more than $25. If the individual entitled to such annuity is also entitled to a benefit for the same month under title II of the Social Security Act, there shall be offset against the increase herein provided for any amount by which such individual's social security benefit was increased by the Social Security Amendments of 1969, but in no case shall such offset operate to reduce the increase below $5. The spouse's annuity computed under the other provisions of this section shall (before any reduction on account of age) be increased by 10 per centum. This paragraph shall be disregarded in the application of the preceding paragraph.

The spouse's annuity computed under the other provisions of this section shall (before any reduction on account of age) be increased by 20 per centum. [The preceding sentence and the other provisions

of this subsection shall not operate to increase the spouse's annuity (before any reduction on account of age) to an amount in excess of the maximum amount of a spouse's annuity as provided in the first sentence of this subsection.] This paragraph shall be disregarded in the application of the preceding two paragraphs.

The spouse's annuity computed under the other provisions of this section shall (before any reduction on account of age) be increased in an amount determined by the method of computing increases set forth in subsection (a) (6) of section 3. The preceding sentence and the other provisions of this subsection shall not operate to increase the annuity of a spouse (before any reduction on account of age) to an amount in excess of the maximum amount of a spouse's annuity as provided in the first sentence of this subsection. This paragraph shall be disregarded in the application of the preceding three paragraphs.

(f) For the purposes of this Act, the term "spouse" shall mean the wife or husband of a retirement annuitant or pensioner who (i) was married to such annuitant or pensioner for a period of not less than one year immediately preceding the day on which the application for a spouse's annuity is filed, or in the month prior to her or his marriage to such annuitant or pensioner was eligible for an annuity under subsection (a) or (d) of section 5 of this Act or, on the basis of disability, under subsection (c) thereof, or is the parent of such annuitant's or pensioner's son or daughter, if, as of the day on which the application for a spouse's annuity is filed, such wife or husband and such annuitant or pensioner were members of the same household, or such wife or husband was receiving regular contributions from such annuitant or pensioner toward her or his support, or such annuitant or pensioner has been ordered by any court to contribute to the support of such wife or husband; and (ii) in the case of a husband, was receiving at least one-half of his support from his wife at the time his wife's retirement annuity or pension began.

(g) The spouse's annuity provided in subsection (e) shall, with respect to any month, be subject to the same provisions of subsection (d) as the individual's annuity, and, in addition, the spouse's annuity shall not be payable for any month if the individual's annuity is not payable for such month (or, in the case of a pensioner, would not be payable if the pension were an annuity) by reason of the provisions of said subsection (d). Such spouse's annuity shall cease at the end of the month preceding the month in which (i) the spouse or the individual dies, (ii) the spouse and the individual are absolutely divorced, or (iii), in the case of a wife under age 65 (other than a wife who is receiving such annuity by reason of an election under subsection (h)), she no longer has in her care a child who meets the qualifications prescribed in section 5(1)(1) (without regard to the provisions of clause (ii) (B) thereof) of this Act.

(h) A spouse who would be entitled to an annuity under subsection (e) if she or he had attained the age of 65 may elect upon or after attaining the age of 62 to receive such annuity, but the annuity in any such case shall be reduced by one one-hundred-and-eightieth for each calendar month that the spouse is under age 65 when the annuity begins to accrue.

(i) The spouse's annuity provided under subsections (e) and (h) of this section without regard to [the last paragraph plus the two

preceding paragraphs] the last paragraph plus the three preceding paragraphs of such subsection (e) shall (before any reduction on account of age) be reduced in accordance with the second proviso in section 3(a) (2), except that, notwithstanding other provisions of this subsection, the spouse's annuity shall (before any reduction on account of age) not be less than one-half of the amount computed in section 3(a) (1) or in that part of section 3 (e) preceding the first proviso, or of the pension, increased by $5 or, if the spouse is entitled to benefits under title II of the Social Security Act, by the excess of $5 over 5.8 per centum of the lesser of (i) any benefit to which such spouse is entitled under title II of the Social Security Act, or (ii) the spouse's annuity to which such spouse would be entitled without regard to section 3(a) (2) and before any reduction on account of age, but in no case shall such an annuity (before any reduction on account of age) be more than the maximum amount of a spouse's annuity as provided in subsection (e).

(j) In cases where an annuity awarded under subsection (a) (3) or (h) of this section or section 5(a) of this Act, is increased either by a recomputation or a change in the law, the reduction for the increase in the annuity shall be determined separately and the period with respect to which the reduction applies shall be determined as if such increase were a separate annuity payable for and after the first month for which such increase is effective.

COMPUTATION OF ANNUITIES

SEC. 3. (a) (1) The annuity of an individual shall be computed by multiplying his "years of service" by the following percentages of his "monthly compensation": 3.58 per centum of the first $50; 2.69 per centum of the next $100; and 1.79 per centum of the remainder up to a total of (i) $450, or (ii) an amount equal to one-twelfth of the current maximum and taxable "wages" as defined in section 3121 of the Internal Revenue Code of 1954, whichever is greater.

(2) The annuity of the individual (as computed under paragraph (1) of this subsection, or under that part of subsection (e) of this section preceding the first proviso) shall be increased in an amount determined from his monthly compensation by use of the following

table:

The amount of the increase shall be the amount on the same line as that in which the range of monthly compensation includes his monthly compensation: Provided, however, That, for months with respect to which the individual is entitled to a supplemental annuity under sub

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section (j), the increase provided in this paragraph shall be reduced by 6.55 per centum of the amount determined under paragraph (1), or under that part of subsection (e) of this section which precedes the first proviso, which is based on the first $450 of the monthly compensation or an amount equal to the amount of the supplemental annuity payable to him, whichever is less: Provided further, That for months with respect to which the individual is entitled to a benefit under title II of the Social Security Act, the increase shall be reduced by (i) 17.3 per centum of such social security benefit if the increase has not been reduced pursuant to the preceding proviso or (ii) 11.5 per centum of such social security benefit if the increase has been reduced pursuant to the preceding proviso (disregarding for the purpose of this and the following proviso any increase in such benefit based on recomputations other than for the correction of errors after the first adjustment and any increases derived from legislation enacted after the Social Security Amendments of 1967): And provided further, That the amount computed under this subsection for any month shall not be less than the amount computed in accordance with paragraph (1), or under that part of subsection (e) of this section which precedes the first proviso, plus (i) $10 minus any reduction made pursuant to the first proviso of this paragraph or (ii) if the individual is entitled to a benefit under title II of the Social Security Act and no reduction is made pursuant to the first proviso of this paragraph, $10 minus 5.8 per centum of the lesser of the amount of such social security benefit, or of the amount computed in accordance with paragraph (1), or under that part of subsection (e) of this section which precedes the first proviso.

(3) The annuity computed under paragraphs (1) and (2) of this subsection and that part of subsection (e) of this section which precedes the first proviso shall be increased by 15 per centum but not by more than $50. If the individual entitled to such annuity is also entitled to a benefit for the same month under title II of the Social Security Act, there shall be offset against the increase herein provided for any amount by which such individual's social security benefit was increased by the Social Security Amendments of 1969, but in no case shall such offset operate to reduce the increase below $10.

(4) The annuity computed under the preceding provisions of this subsection and that part of subsection (e) of this section which precedes the first proviso shall be increased by 10 per centum.

(5) The individual's annuity computed under the preceding provisions of this subsection and that part of subsection (e) of this section which precedes the first proviso shall be increased by 20 per centum.

(6) If title II of the Social Security Act is amended to provide an increase in benefits payable thereunder at any time during the period July 1, 1973, through December 31, 1974, the individual's annuity computed under the preceding provisions of this subsection and that part of subsection (e) of this section which precedes the first proviso shall be increased in an amount equal to the difference between (i) the amount (before any reduction on account of age) which would be payable to such individual under the then current law if his or her annuity were computed under the first proviso of section 3 (e) of this Act, without regard to the words "plus 10 per centum of such total amount" contained therein; and (ii) the amount (before any reduction on account