Will federal employees get nicked by budget cuts in the next few months? Probably not. But hiring freezes and even layoffs in some agencies are not being ruled out by Bush administration officials.
In wrapping up a $388 billion catch-all spending bill, Congress imposed a 0.8 percent across-the-board cut for non-defense agencies on what lawmakers originally intended to provide. That got the bill in sync with White House budget limits and enabled members of Congress to add money to some favored agencies, such as the National Aeronautics and Space Administration.
The spending bill for fiscal 2005 -- already nearly two months late -- awaits a final vote in the House today before being sent to President Bush.
It would provide the government's civil service and military personnel with a 3.5 percent pay raise, effective in January. The Bush administration had lobbied for a smaller raise for the civil service, contending that a raise of 3.5 percent would be difficult for non-defense agencies to absorb.
Now, the administration suggests that some agencies might find it harder to meet salary obligations and maintain programs.
"Each agency will have 0.8 percent less money to fund a 3.5 percent pay increase that was not budgeted for, requiring them to pare back programs or consider finding that money through personnel actions," said Chad Kolton, spokesman for the Office of Management and Budget.
An official at the Office of Personnel Management said the personnel actions could include "freezing hiring and/or promotions or conducting reductions in force."
Layoffs won't necessarily happen, though. Agencies have been hit with across-the-board cuts in the past and typically have resorted first to reductions in travel, training, office equipment and other overhead.
The spending bill leaves it up to the White House to decide how to allocate the pay increases -- between a general pay increase and "locality" adjustments. In September, the Federal Salary Council, an advisory group, recommended that 2.5 percent be paid across the board and that the remainder be divided up as locality pay. In the Washington-Baltimore area, the formula used for locality pay should result in raises slightly higher than 3.5 percent.
The measure also contains language, first used last year, that links raises for the government's blue-collar employees to those of white-collar employees. Blue-collar employees would receive raises that at least equal -- and in some cases could slightly exceed -- those of their white-collar counterparts in the same locality pay zone, according to OPM.
Until last year, raises of blue-collar employees, who are under a separate locality pay system, were capped at the average increase for white-collar federal employees nationally.
The bill would require OPM to submit by March 4 a report comparing the pay and benefit packages of the federal workforce and the private sector. That report could figure in congressional deliberations next year over the 2006 federal raise.
The measure would deny funding in fiscal 2005 for the "human capital performance fund," a Bush administration initiative designed to reward top-performing employees with higher salaries.
Congress authorized the fund last year at the White House's request, but appropriated only $1 million, essentially enough only to get the fund set up on paper. For fiscal 2005, the administration requested $300 million but ran into objections in the Senate, which opposed any funding on grounds that pay-for-performance should be handled by individual agencies, not through a central fund.
Health Insurance Symposium
On Monday, Rep. Thomas M. Davis III (R-Va.) will sponsor a Federal Employees Health Benefits Symposium, featuring health care expert Walton Francis and representatives of OPM and the National Association of Retired Federal Employees.
The symposium will run from 10 a.m. to noon and will be held at the Fairfax County Government Center, 12000 Government Center Pkwy. Representatives of health insurance companies will be available to answer questions.
For more information, call 703-916-9610 or 703-437-1726. Registration is not required.
Diary associate Eric Yoder contributed to this report.
