President Reagan is considering as part of the upcoming budget a six-month delay in cost-of-living increases this year not just for Social Security recipients but Civil Service and military retirees, railroad retirees and veterans.
He also may seek a six-month delay in inflation adjustments in food stamp benefits and disability pay for coal miners with black-lung disease, administration officials said yesterday.
These programs all contain annual cost-of-living adjustments that could be postponed in parallel with the six-month delay for Social Security recipients that was part of the bipartisan compromise worked out over the weekend and approved by Reagan, House Speaker Thomas P. (Tip) O'Neill Jr. (D-Mass.) and other congressional leaders.
The cost-of-living delay for federal retirees would come in addition to the federal pay freeze that Reagan also is proposing, and that further part of the Social Security compromise that would require all new federal employes to pay the Social Security tax.
One informed administration official said yesterday that there is a "good likelihood" that the president will seek to delay the other inflation increases as part of his effort to spread out the "sacrifices" in the fiscal 1984 budget he is scheduled to send to Congress Jan. 31. Another official said that some delay in cost-of-living adjustments for these other programs is likely, but the length of it has not yet been approved by the president.
Reagan is struggling to hold down huge projected deficits in the fiscal 1984 budget. On another front in this effort, administration officials said yesterday that cuts Reagan plans to seek in so-called discretionary domestic spending--those domestic spending programs subject to the annual congressional appropriations process--will be almost the equivalent of a "freeze" at current levels.
This idea of a "partial freeze," which drew favorable comment over the weekend from Senate Budget Committee Chairman Pete V. Domenici (R-N.M.), will be reflected in the overall budget totals, but specific programs will vary, administration officials said.
"The net result of all the ups and downs is very similar to a freeze," one administration official said.
It was also learned yesterday that the administration, searching for ways to show declining deficits in future years, plans again to propose changes in the farm price support program.
The administration, which made a similar but unsuccessful proposal in the lame-duck session of Congress, will seek a "freeze" on the "target price" from which income supplements to farmers are calculated, administration officials said.
This would be part of an effort, which also includes the payment-in-kind "crop swap" program Reagan recently announced, to bring rising federal farm programs under control.
White House spokesman Larry Speakes said yesterday that the administration plans to include in the fiscal 1984 budget the estimated tax and spending effects of the Social Security compromise reached over the weekend. The administration had not calculated these precise effects yesterday.
But informal calculations, which an authoritative commission source said were good ballpark estimates, showed that the compromise would bring the deficit down by about $2.5 billion in this fiscal year, 1983. It would then bring the deficit down by about $11 billion in fiscal 1984, $14 billion in fiscal 1985 and $13 billion in fiscal 1986, according to these figures.
A chief goal of the administration's budget jockeying in recent weeks has been to reduce the so-called "out-year" deficits, which are projected to rise to nearly $300 billion by fiscal 1988 without offsetting action. The administration is now said to be estimating the fiscal 1984 deficit without any policy changes at $248 billion. The administration is trying to bring that below $200 billion if all budget cuts are approved by Congress.
In later years, it was learned yesterday that the administration is projecting a gradually declining deficit that will fall under $90 billion in fiscal 1988. Reagan is expected to propose a "contingency tax" for later years if deficits do not decline. An oil import fee and an income tax surcharge are two alternatives under study for this contingency tax. As to a delay in cost-of-living adjustments, Dole said the six-month delay included in the Social Security compromise package "does sort of provide a foundation" for the administration and Congress "to treat other programs the same as we've treated Social Security."
The other programs with inflation-triggered adjustments that might be affected are Civil Service and military retirement, veterans' pensions, veterans' compensation for service-connected disability, railroad retirement, food stamps, Supplemental Security Income and benefits for coal miners with black lung disease.
Not all the programs are indexed to inflation in the same way and on the same schedule. But administration officials said they are all candidates for possible delays in inflation adjustments.
Such a six-month postponement would reduce the deficit by about $3 billion to $3.5 billion a year, the officials said.