White House to propose 0.5 percent pay increase

The paper says two senior administration officials with knowledge of budget plans confirmed that the proposal would be included.

Federal employees are currently under a two-year pay freeze. A 1.6 percent raise for military service members recently went into effect, and recipients of Social Security benefits got a 3.6 percent cost-of-living allowance this year.

It may be difficult to get approval for the federal employee pay raise on Capitol Hill. Late last year, the House passed a bill that would have extended the current payroll tax cut for a year and partly financed it through a longer salary freeze for federal employees and lawmakers, along with a requirement that both groups contribute more to their government pensions.

The Senate's version of the legislation did not include those spending offsets. In the end, Congress opted only to extend the payroll tax cut for two months.

Washington-area lawmakers and a handful of other Democrats criticized plans to reduce federal employees' compensation to help pay for the tax cut. The White House, however, remained mum on the issue.