Bush moves to limit 2005 pay raise to 2.5 percent

President Bush has moved to limit the pay increase for white-collar civilian federal employees under the General Schedule to 2.5 percent next year, with no additional pay for workers based on labor costs in the areas where they work.

Under federal law, the president had until the end of November to propose an alternative to pay levels set under procedures laid out in the 1990 Federal Employees Pay Comparability Act. Under the law, employees would have been due the 2.5 percent raise next year, plus locality pay increases averaging 10.6 percent. The act was designed to close the gap between federal and private-sector salaries, but raises under the law have never been fully funded.

Locality pay rates would remain at the 2004 level next year under the alternative plan Bush forwarded to congressional leaders on Monday. According to the president, funding the locality pay raise would cost about $9.8 billion in fiscal year 2005 and pull much-needed resources from other areas.

"A national emergency has existed since September 11, 2001, which now includes Operation Enduring Freedom (in Afghanistan) and Operation Iraqi Freedom," Bush wrote. "Full statutory civilian locality pay increases averaging 10.6 percent in 2005 would divert resources from and interfere with our nation's ability to fight the war on terror, with respect to which a national emergency is in effect under the law."

When the budget was released in February, the Bush administration proposed a 1.5 percent average pay increase for federal workers and a 3.5 percent raise for military service members. In the months since, members of Congress have worked to provide a 3.5 percent pay raise to civilians and uniformed members of the armed services. Last week Congress approved the fiscal 2005 omnibus spending bill, which included a 3.5 percent average pay raise for civilian employees.

In his letter, Bush said he did not believe his decision would "materially affect" the government's ability to attract and retain a quality workforce.

"To the contrary, since the Congress has not funded the cost of a pay raise in excess of the 1.5 percent increase I proposed, agencies would have to absorb the additional cost and could have to freeze hiring in order to pay the higher rates," Bush wrote, adding that "quit rates are at an all-time low of 1.6 percent per year, well below the overall average quit rate in private enterprise." Accordng to the president, agencies can use compensation tools, such as recruitment bonuses, retention allowances and special salary rates, if needed.

Stay up-to-date with federal news alerts and analysis — Sign up for GovExec's email newsletters.
FROM OUR SPONSORS
JOIN THE DISCUSSION
Close [ x ] More from GovExec
 
 

Thank you for subscribing to newsletters from GovExec.com.
We think these reports might interest you:

  • Sponsored by G Suite

    Cross-Agency Teamwork, Anytime and Anywhere

    Dan McCrae, director of IT service delivery division, National Oceanic and Atmospheric Administration (NOAA)

    Download
  • Data-Centric Security vs. Database-Level Security

    Database-level encryption had its origins in the 1990s and early 2000s in response to very basic risks which largely revolved around the theft of servers, backup tapes and other physical-layer assets. As noted in Verizon’s 2014, Data Breach Investigations Report (DBIR)1, threats today are far more advanced and dangerous.

    Download
  • Federal IT Applications: Assessing Government's Core Drivers

    In order to better understand the current state of external and internal-facing agency workplace applications, Government Business Council (GBC) and Riverbed undertook an in-depth research study of federal employees. Overall, survey findings indicate that federal IT applications still face a gamut of challenges with regard to quality, reliability, and performance management.

    Download
  • PIV- I And Multifactor Authentication: The Best Defense for Federal Government Contractors

    This white paper explores NIST SP 800-171 and why compliance is critical to federal government contractors, especially those that work with the Department of Defense, as well as how leveraging PIV-I credentialing with multifactor authentication can be used as a defense against cyberattacks

    Download
  • Toward A More Innovative Government

    This research study aims to understand how state and local leaders regard their agency’s innovation efforts and what they are doing to overcome the challenges they face in successfully implementing these efforts.

    Download
  • From Volume to Value: UK’s NHS Digital Provides U.S. Healthcare Agencies A Roadmap For Value-Based Payment Models

    The U.S. healthcare industry is rapidly moving away from traditional fee-for-service models and towards value-based purchasing that reimburses physicians for quality of care in place of frequency of care.

    Download
  • GBC Flash Poll: Is Your Agency Safe?

    Federal leaders weigh in on the state of information security

    Download

When you download a report, your information may be shared with the underwriters of that document.