We spotted an interesting nugget within the testimony of Congressional Budget Office Director Douglas Elmendorf, who’s meeting Wednesday with the congressional supercommittee to discuss federal agency budgets.
Elmendorf said in his written testimony that the government spent about $200 billion to compensate federal workers in the fiscal year that ended in September. That’s 15 percent of total discretionary spending -- the spending levels that lawmakers control through appropriations.
In fiscal 2011, discretionary spending totaled $1.35 trillion — or 40 percent of federal outlays — with most of the money going to the Pentagon and to pay for the wars in Iraq and Afghanistan, Elmendorf said.
The $200 billion estimate includes worker salaries and benefits, such as health-care and retirement, according to a CBO spokeswoman.
Of the $200 billion, about $80 billion went towards civilian employees of the Defense Department and other defense-related activities, according to CBO estimates. Another $120 billion went to non-defense civilian employees, most of whom work for the departments of Veterans Affairs, Homeland Security, Justice and the Treasury and the Internal Revenue Service.
It’s not surprising (because there’s never an easy answer on budgetary issues), that the CBO’s estimates differ slightly from actual spending.
Executive Branch agencies paid about $228 billion on pay and benefits in fiscal 2010, according to the White House’s 2012 budget proposal — a figure that excludes military personnel and U.S. Postal Service pay and benefits. The Legislative Branch paid about $2.8 billion in total compensation, while federal judiciary employees received a total of $4.1 billion in compensation in fiscal 2010 — the most recent year for which actual numbers are available.
In his testimony, Elmendorf noted that agency spending fell last year to its lowest level since 2002 and would fail to keep pace with inflation under budget caps adopted during this summer’s debate over the federal debt limit.
And agency budgets could take another big hit if the supercommittee fails to agree on additional savings — because the debt deal brokered over the summer would then trigger $1.2 trillion in automatic spending cuts. If that happens, agency spending would lag behind inflation by as much as 16 percent by 2021 — endangering several big programs, including veterans’ health care, Elmendorf said.
The CBO chief also warned that lowering the pay of federal employees “could hamper efforts to recruit and retain workers (particularly in some occupations), which could reduce the overall skill level of the federal workforce over time.
“Having fewer federal workers would probably lower the levels of service that federal agencies provide to the public, unless cuts in the agencies’ workforces were accompanied by actions to enhance productivity,” Elmendorf added.
His warning touches on, at least indirectly, the concern that government services would be cut along with the budget — an issue raised by federal labor unions, lawmakers and other groups. But there’s no direct correlation between service cuts and federal job cuts. Cutting a program’s budget by 10 percent, for example, would not necessarily mean a 10 percent cut in the workforce administering that program. Inevitably, it could be more, or could be less, depending on the nature of the program.
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