A bill to amend title 5, United States Code, to provide that the annuity or retirement pay payable to a Federal retiree may not be increased by a cost-of-living adjustment beyond a certain percentage of the basic pay currently payable to those in active service.

Prohibits increasing an individual's civil service annuity or uniformed service retired pay by a cost of living adjustment beyond a certain percentage of the current pay rate for the highest grade level attained by the individual before retirement, unless the increased annuity or retired pay would not exceed $20,000. Sets such percentage as the percentage of the individual's highest pay rate paid as such individual's annuity or retired pay as of the commencement date of such annuity or retired pay.