House Approval of Ryan Budget Marks Another Attack on Federal Employees

Press Release April 10, 2014

Washington, D.C.—Federal employees would again bear a disproportionate burden of deficit reduction measures under the budget approved today in the House of Representatives, the leader of the nation’s largest independent union of federal employees said.

Higher pension contributions would be required by federal workers that could amount to as much as 5 to 6 percent of their salaries, effectively cutting their pay. Overall, the federal workforce would contribute $125 billion in savings from the federal retirement system.

“Federal employees have already sacrificed enough,” said President Colleen M. Kelley of the National Treasury Employees Union (NTEU). Collectively, federal workers already have contributed $138 billion to deficit reduction and economic recovery, including a three-year pay freeze.

The House today approved the proposal advanced by Budget Committee Chair Paul Ryan (R-Wis.), after turning back a more reasonable approach offered by the committee’s ranking member, Rep. Chris Van Hollen (D-Md.).

The Ryan budget plan calls for higher federal employee pension contributions with no change in annuity. Ryan staff members earlier said that under the proposal, employee contributions would climb to 6.35 percent of salary under the retirement system covering most federal workers. That would be a jump of more than 5.5 percentage points for the majority of the workforce.

In addition, it would eliminate the supplemental payment for those who retire under FERS before age 62 and transition the federal retirement system into a defined contribution plan.

Moreover, President Kelley noted, the Ryan budget would make further, but unspecified, cuts to federal pay and benefits, and hollow out the workforce by limiting hiring to one new employee for every three who leave federal service. It also would eliminate repayment by the government of student loans for federal workers.

Most ominously for the public, however, the House-approved budget would continue the damaging policy of sequestration, which would be extended by three years to 2024. NTEU has been in the forefront of calls for an end to sequestration.

“Under sequestration,” President Kelley said, “federal agencies are straining to meet their mission requirements with sharply-reduced budgets and insufficient personnel.” She cited the Internal Revenue Service (IRS) as one prominent example.

“The IRS budget has been cut by nearly $1 billion since 2010,” she said, “resulting in the loss of some 10,000 employees—losses that have translated into long telephone hold times, limited services and lengthy waits at Taxpayer Assistance Centers this tax-filing season.”

Kelley added: “This budget moves our nation in exactly the wrong direction. Instead, we need to be moving toward the elimination of sequestration and providing agencies and their employees with the tools and resources they need to provide the services the public expects and needs.”

NTEU is the largest independent federal union, representing 150,000 employees in 31 agencies and departments.

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