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Federal Eye
Posted at 01:23 PM ET, 04/08/2011

Government shutdown: Cuts in federal pay and benefits targeted as part of budget compromise, sources say

UPDATE: April 9 12:43 a.m. ET

Multiple sources confirm to The Post that a proposal to cut $1.3 billion in federal pay raises is not included as part of the short-term spending bill passed early Saturday or the final measure set to be passed by Thursday.

Original Post | April 8 1:23 p.m. ET

Congressional and White House budget negotiators hoping to pass a deal to fund the government by the end of Friday are considering $1.3 billion in savings by cutting the pay of at least some federal employees, possibly by denying some bonuses and step increases, according to a Republican aide familiar with the GOP offers and a senior administration official.

Eye Opener

If enacted, those cuts would be the first cuts to the federal pay and benefits system made as part of the ongoing effort to seriously curtail government spending.

The amount — about $1.3 billion — is a mere fraction of the trillion dollars in annual spending by the federal government. As of Friday morning it is just one of several ideas being floated as part of a potential solution to the budget impasse. (And even if it is included in a compromise deal, there’s no guarantee the deal can quickly glide through the House and the Senate.)

But if enacted, the denial of bonuses and step increases would be a significant political victory for congressional Republicans, many of whom last year campaigned on the idea of cutting the pay and benefits of federal employees. Many GOP candidates and their supporters strongly believe that the feds have been unfairly rewarded and protected by government-backed job security during the economic downturn.

Eager to demonstrate he understood those frustrations after November’s midterm elections, President Obama froze the pay of federal employees for two years — a move cheered by a majority of Americans who believe federal workers are overpaid, according to a Washington Post poll from last year. The move proved wildly unpopular with the rank and file, many of whom backed Obama’s presidential campaign.

The National Treasury Employees Union said Friday it is “adamantly opposed” to any proposals curtailing federal pay.

Doing so “is a gross injustice to them and to their service to our nation,” said the union’s president, Colleen M. Kelley. “Federal employees already have been unfairly targeted in multiple ways.”

Most career federal employees are paid under a salary system called the General Schedule, which has 15 main levels called grades, each with 10 sub-levels called steps. Employees are assigned a grade according to the nature of their job.

Employees advance through the steps of their grade on a regular schedule, earning an average 3 percent raise per step. These increases are called “within-grade raises” or “step increases.” Advancement is based mainly on longevity and are granted every one, two or three years depending on the employee’s level.

Also, workers can be advanced more rapidly based on good performance, and the increases can be denied for unacceptable performance.

Within-grade raises have been paid so far this year even though Congress and the White House last year agreed to the two-year pay freeze. But some Republican members have decried the within-grade raises as a loophole in what was intended to be a broad pay freeze. Despite that, the House earlier this year defeated a proposal to deny the raises for the remainder of this fiscal year.

Employees also are continuing to receive higher pay due to promotions, and also have been receiving various types of awards, which do not increase their basic salaries.

Staff writer Paul Kane contributed to this report.

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By and  |  01:23 PM ET, 04/08/2011

Categories:  Government Shutdown, Eye Opener, Workplace Issues

 
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