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Washington, D.C.?Administration estimates that put the anticipated federal budget surplus at $1.87 trillion over the next decade create "the best opportunity yet" to move aggressively toward implementation of a federal pay law that will help the government recruit and retain the talented workers it needs, said National Treasury Employees Union (NTEU)

National President Colleen M. Kelley.

The administration's 2001 budget contains a proposed federal civilian pay raise of 3.7 percent. In a letter to President Clinton, Kelley urged that the 2001 pay raise for federal employees should be at least 4.2 percent.

She also asked for the president's "active support" for legislation endorsed in his budget proposal that would repeal a 0.5 percent retirement contribution increase imposed on federal employees at a deficit?reduction tool. "Clearly, any justification for such a penalty on federal workers has passed," she said.

The leader of the nation's largest independent union of federal workers said "there has never been a better time to follow through on the commitment" contained in the 1990 Federal Employees Pay Comparability Act (FEPCA). That law, which has not been honored in full in any year since its enactment, was designed to close, in stages over 10 years, the gap between public and private sector pay. "A meaningful attempt must be made to close the pay gap during these good economic times," she said.

In her letter to Mr. Clinton, Kelley said "the evidence in mounting" that good economic news is making it harder for the federal government to attract and retain "the high?performing employees who will deliver the high quality service that American taxpayers deserve."

A 4.2 percent pay increase, along with repeal of the retirement contribution increase and "a renewed commitment to FEPCA in the future" will help address federal workforce recruitment and retention problems "before they become insurmountable," she wrote.

In recent Senate testimony on federal recruitment and retention problems, Kelley noted pointedly the long?term trend in which fewer and fewer of the brightest graduates of the nation's most prestigious schools of public service are choosing employment with the federal government.

She said the projected budget surplus was generated in part by the efforts of a federal workforce that is the smallest in more than 30 years and which contributed some $220 billion in pay and benefit increases denied and delayed over the past dozen years. "No other single group contributed as much," the NTEU president said.

NTEU represents some 155,000 employees in 24 agencies and departments.

The reason for the disturbing trend, President Colleen M. Kelley of the National Treasury Employees Union (NTEU) told a Senate Subcommittee, is that the federal compensation package ?including the critical elements of pay, retirement and health benefits?lags farther and farther behind the private sector.

"Federal employees, just like their private sector counterparts, must believe that substantial rewards exist for excellence and productivity," Kelley told the Subcommittee on Government Management of the Senate Committee on Governmental Affairs.

Without appropriate compensation and incentives, she said, the federal government "will find it increasingly difficult to remain competitive" with private employers.

The NTEU president cited studies, including one by the government's General Accounting Office (GAO) going back to 1994, and more recent analyses by Harvard's John F. Kennedy School of Government and the George Washington University public administration department, showing lagging interest in employment with the federal government.

The single most important and pressing step, she said, would be "a decision to fully implement" the 1994 Federal Employees Pay Comparability Act (FEPCA), which called for the closing, in stages over 10 years, of the public?private pay gap. "That would do more to address recruitment and retention in the federal government than all remaining incentive programs combined," she said.

Since its enactment, however, no annual federal pay raise has been even close to the level called for under the FEPCA formula, and the pay gap continues to be sizeable, she said.

Beyond implementing FEPCA, Kelley said, Congress needs to "provide adequate discretionary funding" to agencies to allow them to implement various programs in existing law, including recruitment, retention and relocation bonuses and awards programs recognizing various aspects of excellence in performance.

"Agencies simply do not have the resources to adequately fund these important incentives," she said. "They are constantly forced to rob Peter to pay Paul."

The union leader urged more federal sector use of "family?friendly programs" such as alternative work schedules, telecommuting options, flexiplace, leave banks, child care subsidies and the chance to use personal sick leave to care for ill family members.

"These benefits provide a sense of community both inside and outside the office," she said, emphasizing the positive impact on agency performance of reduced absenteeism, increased morale and motivation and higher rates of employee retention.

NTEU represents some 155,000 employees in 24 agencies and departments, and has long been the leader in the fight for higher pay and a broader range of benefits for federal employees.