Pay and Benefits Watch: Bigger surplus, higher pay?

National Treasury Employees Union President Colleen M. Kelley is trying to capitalize on the recent news that the federal budget surplus will be even larger than anticipated.

The head of one of the largest unions for federal employees has pitched President Clinton a proposal to increase the 2001 federal pay raise to a minimum of 4.2 percent.

Kelley argues that if anyone deserves credit for the stellar surplus, it's federal employees, saying they have been denied some $220 billion in pay and benefits increases over the past dozen years or so as a means of contributing to deficit reductions.

In a letter to the President, Kelley also demanded that the 0.5 percent retirement contribution increase imposed on federal employees last year be repealed.

The temporary increase in employee contributions began in January 1999 and is scheduled to end in 2002. Extending the increase beyond 2002 would save the government about $1 billion a year through 2010, according to Congressional Budget Office estimates.

"Clearly, any justification for such a penalty on federal workers has passed," Kelley said.