The Reagan administration's proposed 5 percent pay cut for federal employes came under heavy bipartisan attack at its congressional debut yesterday as Donald J. Devine, the plan's architect, was grilled and occasionally jeered in a House hearing room jammed by 500 federal workers.
Devine, director of the Office of Personnel Management (OPM), told a House subcommittee that the severity of the federal deficit required government workers to take pay and benefit cuts similar to those accepted by labor unions in struggling businesses.
"A corporation with a $200 billion red ink balance . . . surely is a business in trouble. We must all share in putting our house back in order," Devine told the House Post Office and Civil Service subcommittee on federal pay and benefits.
But a combative Rep. Mary Rose Oakar (D-Ohio), the subcommittee chairman, accused Devine's agency of using misleading data to justify the cuts. "Government workers are not being treated fairly in this budget and everybody knows that, Dr. Devine . . . and I think you know that," Oakar said.
In addition to the pay cut, the proposals would raise the age for full retirement benefits from 55 to 65 and penalize retirees 5 percent for each retirement year before age 65. Cost-of-living adjustments (COLAs) for pensions would be eliminated for fiscal 1986 and reduced starting in 1987, and the pay base for future COLAs and pension computations would be cut.
Oakar and Reps. Michael D. Barnes (D-Md.) and Stan Parris (R-Va.), followed by a parade of union officials, said the cuts will deeply demoralize federal workers. Barnes called for a pay raise.
Devine said the federal retirement system -- the government's third-largest entitlement program at $23 billion a year -- is overly generous compared with private firms' and "is a system badly in need of reform." The government spends 28 percent of payroll costs on pensions, compared with 18 percent in private firms, he said.
A key point in OPM's contention that federal workers are overpaid has been their lower "voluntary quit rate" when compared with private workers or postal employes. Oakar asked Devine to define the term, but he could not, saying, "I don't write everything we do at OPM." He also did not respond to Oakar's allegation that OPM used "selective data" to make the federal quitting rate appear comparatively lower.
"I am not trying to make you look foolish," Oakar said, "but you have to agree that if you don't know what your own terminology means . . . your study is negated . . . . You have used this report and waved your credentials, and I am asking you something about your data, and you ought to know."
"You took selective data out of context, and used it to prove your conclusions," she said.
Devine, who impassively chomped on a cigar throughout the hour-long questioning, said, "I don't care what set of data you look at, the turnover rate is lower."
After the hearing, Devine said he believed that the 1984 presidential election "slaughter" had created "a whole different mood now . . .about cutting the budget, and I am sure we are going to get this change."