Proposed pension contribution hike is latest foray into federal worker pockets

Joe Davidson
Columnist February 16, 2012

Perhaps federal employees should wear a big red suit with a thick black belt and a funny looking red hat. A flowing white beard, natural or fake, would set the uniform off just right.

News this week won’t make federal workers jolly, but why not dress them like Santa Claus if current and future staffers are asked — make that required — to give like Saint Nick at Christmas?

Joe Davidson writes the Federal Diary, a column about the federal workplace that celebrated its 80th birthday in November 2012. View Archive

The latest foray into the pockets of federal employees, in this case those hired beginning next year, comes in the form of increased pension contributions. The increased payments are part of a deal that would extend unemployment insurance, continue the payroll tax holiday and prevent a cut in Medicare payments to doctors. The increased pension contributions would be used specifically for the unemployment insurance.

New workers (with fewer than five years of previous service) would contribute 3.1 percent of their salaries to their pension benefits, significantly more than the 0.8 percent paid by most current staffers, in addition to Social Security contributions.

The second-ranking Democrat in the House, Rep. Steny H. Hoyer of Maryland, released a statement opposing the deal: “We must stop targeting these hardworking men and women while not asking others to contribute their fair share. For that reason, I cannot support this bill.”

Union leaders were quick and vociferous in urging Congress to reject the deal.

“For a GS-3 nursing assistant earning $27,322 while working in a VA hospital psychiatric ward, this will be a $628 annual tax increase,” John Gage, president of the American Federation of Government Employees, said in a letter to Congress. “For a GS-5 USDA meat and poultry inspector earning $31,825 while protecting Americans from E. Coli and other deadly diseases caused by contaminated meat, this will be a $732 annual tax increase. For a GS-7 federal penitentiary correctional officer earning $38,790 while guarding ruthless gang leaders in dangerously understaffed institutions, this will be an $893 annual tax increase. In short, this ‘deal’ is an outrageous injustice that deserves the vociferous opposition of every Member of Congress with a conscience.”

Hoyer’s district is home to thousands of federal workers. He’s tired of the House Republican majority viewing the federal workforce as “almost a sole payer for things they want to do.”

“In this bill that is being proposed on the payroll tax cut, the unemployment insurance and the so-called doc fix, federal employees are the only individuals being targeted to make a contribution toward paying for this,” Hoyer said in an interview. “No millionaires are being asked to pay. No oil companies are being asked to pay.”

Of course Republicans, who continually look for ways to make federal employees pay more while opposing even a small additional tax on the rich, disagree.

“With respect, Mr. Hoyer needs to get outside of the Beltway,” said Rep. Dennis A. Ross (R-Fla.). “Reality is that the hardworking taxpayer cannot fund federal pensions, defense, Social Security, Medicare and the hundreds of billions in bureaucracy Mr. Hoyer supports.”

Hoyer noted that federal workers are already contributing $60 billion over 10 years through the two-year freeze on basic federal pay rates. The new agreement would generate an additional $15 billion from federal workers.

Hoyer is concerned that repeatedly taking money from employees will hurt the government’s ability to recruit and retain them.

“We need really good people to come to public service, and quite frankly they are not going to come to public service if they believe the Congress and the president of the United States are going to, on a regular basis, propose undercutting their pay and benefits,” he said.

President Obama’s fiscal 2013 budget, released Monday, would raise federal pay by 0.5 percent and have federal employees increase their retirement contributions by 1.2 percent of their salaries over three years. But that increase, Hoyer noted, is part of a balanced approach.

Nonetheless, Sen. Benjamin L. Cardin (D-Md.) told my colleague Ed O’Keefe that Obama’s plan to increase employee retirement payments “made it more difficult for us to be able to keep the federal contribution from workers out of the package.”

Hoyer called on Obama to speak more forcefully on behalf of government staffers.

“I think the White House and the president should make this message clearer and more understandable to the American public,” he said. “The federal employees are patriotic Americans who are willing and who have participated in trying to get a handle on the fiscal challenges that confronts us.

“But they can’t do it alone, nor should they do it alone.”

Previous columns by Joe Davidson are available at wapo.st/JoeDavidson. Follow the Federal Diary on Twitter: @JoeDavidsonWP

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