EXHIBIT 1:

Summary of the PUMS-II National Results

Introduction

The Social Security Administration (SSA) set a goal in its Agency Strategic Plan (ASP) "to strengthen public understanding of Social Security programs." To reach this goal, SSA's objective is to ensure that, by the year 2005, 90% of Americans will be knowledgeable about Social Security programs.

In order to measure progress toward achieving this goal, SSA developed the Public Understanding Measurement System (PUMS) to establish baseline data on the public's knowledge and to track changes in the public's level of knowledge through the year 2005. The PUMS initiative provides SSA with data and information needed to design annual public education programs targeted to address specific knowledge or performance gaps (e.g., areas where public knowledge is lower than 90%) and to evaluate the effectiveness of SSA public education initiatives in achieving its strategic objective.

SSA contracted with The Gallup Organization to develop and conduct the PUMS surveys. At this point, national surveys have been completed for 1998 and 1999 (referred to as PUMS-I and PUMS-II, respectively). For PUMS-II, a new section was added to the survey instrument to measure the usefulness and ease of understanding of the Social Security Statement.

In addition to the national survey, a one-year knowledge tracking study [1] was initiated in November 1999. This study was designed to test the effectiveness of various forms of public education and outreach in raising public awareness and knowledge of Social Security. The knowledge-tracking study is being carried out in sixteen communities located in the Philadelphia, Atlanta, Chicago, and San Francisco SSA regions. The knowledge-tracking instrument also includes the section concerning the Social Security Statement and an additional section on local outreach and education awareness. The results of the knowledge-tracking study will be available in the fall of 2000.

The national and knowledge-tracking survey instruments were developed through a collaborative effort between Gallup survey design experts and SSA officials. National Academy of Social Insurance (NASI) and academic experts were also consulted during this process. The resulting telephone survey instruments are 12 and 13 minutes in length for the national and knowledge-tracking studies, respectively. Both surveys are programmed in English and Spanish and offered in other languages when needed. Four thousand (4,000) respondents were surveyed for PUMS-II (400 in each SSA region). Twelve thousand (12,000) respondents are being surveyed for the knowledge-tracking survey (three thousand per quarter).

The purpose of this briefing book is to summarize the most notable findings of the PUMS-II national survey, completed January 25, 2000.

Overall Knowledge Scores [2]

The overall knowledge level of the adult population did not increase significantly between PUMS-I and PUMS-II. The results of PUMS-II indicate that 56.6% of the public is knowledgeable about Social Security programs as compared to 54.9% in PUMS-I.

In addition, 24.1% of the public is "close to knowledgeable" (e.g., responded correctly to 11 or 12 of the 19 knowledge indicators) in PUMS-II.

Significant Changes between PUMS-I and PUMS-II

The results of PUMS-II are significantly different from the results of PUMS-I for a number of knowledge indicators. The following knowledge indicators received scores in PUMS-II that are significantly higher than the corresponding scores received in PUMS-I.

·        Early retirement. Knowledge that an individual can receive some retirement benefits before the full retirement age rose from 61.8% to 65.4%.

·        Exact age of early retirement. Knowledge that the exact age of eligibility for some retirement benefits is 62 rose from 45.6% to 48.9%.

·        Change in the retirement age. Knowledge that the age for receiving full Social Security retirement benefits is increasing rose from 65.1% to 71.7%.

·        Benefits relate to earnings. Knowledge that the amount of monthly Social Security retirement benefits depends on the level of past earnings rose from 88.9% to 91.8%.

The following knowledge indicators received scores in PUMS-II that are significantly lower than the corresponding scores received in PUMS-I.

·        Use of Social Security Taxes. Knowledge of the use of Social Security taxes fell from 81.1% to 78.0%.

·        Fewer Workers, Future. Knowledge about the insufficient number of workers to finance future benefits fell from 60.7% to 57.4%.

·        Not Food Stamps. Knowledge that Social Security does not pay for the food stamp programs fell from 50.2% to 46.0%.

It is noteworthy that the indicators that increased significantly have high personal relevance while the indicators that decreased significantly are more system-related.

Another significant change between PUMS-I and PUMS-II is an increase in the level of confidence that Social Security benefits will be available for the public when they retire (from 38% to 44%).

Receipt and Awareness of the Social Security Statement

Two pivotal factors in increasing the level of public knowledge about Social Security are receipt and awareness of the Social Security Statement.

·        Receipt of the Statement increased from 20.3% in PUMS-I to 24.2% in PUMS-II, although the difference is not statistically significant.

·        Awareness of the Statement increased significantly from 49.5% in PUMS-I of the public to 62.2% in PUMS-II.

In addition to being statistically significant, the increased awareness of the Social Security Statement is meaningful, because awareness generally precedes a perceived need for information.

Relationship between the Social Security Statement, Knowledge, and Confidence

Receipt and knowledge of receiving a Social Security Statement significantly increase knowledge of Social Security programs. Sixty-eight percent (68.0%) of those who recall receiving a Statement are knowledgeable. Furthermore, knowledge about Social Security programs significantly increases confidence that Social Security retirement benefits will be there for you when you retire. The relationship can be modeled as follows:

Receipt of an SS Statement = Knowledge + Confidence

Response to the Social Security Statement

The proportion of the public (24% or about 48 million people) who recall having received a Social Security Statement had a positive response to it.

·        82.4% of the public (about 39 million people) report finding the Statement to be very to somewhat useful in increasing their knowledge of benefits that may affect them directly.

·        78.8% of the public (about 37 million people) report finding the Statement to be very to somewhat useful in helping to determine their level of need for additional sources of retirement income.

·        66.0% of the public (about 32 million people) report finding the Statement to be very to somewhat useful in helping with their financial planning.

·        83.7% of the public (about 40 million people) report finding the Statement to be very to somewhat easy to understand.

In addition, as a result of receiving a Social Security Statement, millions of Americans report being much more likely to take action to increase their own financial security.

·        52.4% of the public (about 25 million people) report being much more likely to file the statement with their important records.

·        16.9% of the public (about 8 million people) report being much more likely to contact the Social Security Administration for more information.

·        13.5% of the public (about 6.3 million people) report being much more likely to contact a financial advisor.

·        16.1% of the public (about 7.6 million people) report being much more likely to change their retirement plans.

Comparison of Social Security Statement and PEBES

The Social Security Statement is easier to understand than the PEBES document. Fifty-eight percent (58%) of Social Security Statement recipients reported finding it to be very easy to understand, while 50% reported finding the PEBES document very easy to understand. Ease of understanding is also reflected in the likelihood of recipients to contact SSA. One in five recipients (20%) of PEBES recipients stated that they are much more likely to contact SSA, while just over one in ten (12%) of Statement recipients feel likewise.

SSA Public Education Activities

While public need for Social Security information remains high, with over 20% of the population having sought information about Social Security, the public's response to SSA's public education activities is primarily positive.

·        SSA continues to be the preferred source for information about Social Security programs. Of the 22.8% of the public (about 46 million people) who requested Social Security information, 80.8% (about 40 million people) report having requested this information from SSA.

·        Use of SSA's website (SSA Online) as a source of information more than doubled from 1998 to 1999. Five percent (5%) of the public's reported requests for information (nearly 2 million contacts) were made via SSA's website.

·        74% of those who both contacted SSA and received a Social Security Statement (18 million people) were knowledgeable about Social Security programs.