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House passes bill that would cut fed pay, benefits

Apr. 15, 2011 - 08:18PM   |  
By STEPHEN LOSEY   |   Comments
House Majority Leader Rep. Eric Cantor (R-Va.) right, and Rep. Paul Ryan (R-Wisc.) listen during a news conference April 13 on Capitol Hill.
House Majority Leader Rep. Eric Cantor (R-Va.) right, and Rep. Paul Ryan (R-Wisc.) listen during a news conference April 13 on Capitol Hill. (Alex Wong / Getty Images)

The House on Friday passed a Republican budget plan for fiscal 2012 that would freeze federal employees' step increases and pay raises for five years, cut the government's workforce by 10 percent, and require feds to pay much more into their pension plans.

H. Con. Res. 34, proposed by Rep. Paul Ryan, R-Wis., also sets a budget blueprint for the next 10 years that would cut $6 trillion in federal spending. It stands virtually no chance of passing the Senate, which is controlled by Democrats who oppose the bill.

Ryan's plan would only allow the government to hire one new employee for every three who leave, which he said would cut 10 percent from the federal workforce by 2014.

It freezes federal pay through 2015, three years longer than the current pay freeze would last, and cancels periodic step increases. And it adopts the White House's deficit reduction commission's plan to require federal employees to pay half of the costs of their pensions, instead of 1/14th of the cost, as employees under the Federal Employees Retirement System currently pay.

House Oversight and Government Reform Committee Chairman Darrell Issa, R-Calif., said the bill's federal workforce provisions would bring federal pay and benefits more in line with the private sector, and save $375 billion over ten years.

"The Path to Prosperity budget sets the stage for critical cost-cutting reforms from the federal workforce that reduce the deficit and help grow our economy," Issa said.

The National Active and Retired Federal Employees Association said this would likely mean FERS employees would pay about 5.8 percent of their salaries toward their pensions, instead of the 0.8 percent they currently contribute. FERS employees already contribute 6.2 percent of their salaries to Social Security, which Adcock said would mean FERS employees would pay 12 percent in all toward their pensions.

Civil Service Retirement System employee contributions would increase from 7 percent to about 12.5 percent, NARFE said. They do not pay into Social Security or receive any benefits from that program.

A coalition of 22 federal employee unions, management groups and retiree representatives sent a letter to lawmakers April 13 denouncing the plan and urging Congress to vote it down. They said the proposed changes to pension funding would cut federal employees' pay, and said such steep workforce cuts are "more about politics than good human resource management."

"The budget resolution's plan to take the wages of our federal workers and reduce their pay will damage the government's ability to fulfill its responsibility to its citizens," the groups said.

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