The Congressional Budget Office (CBO) has released its report of policy options to help Congress reduce the deficit, providing estimated budget impacts and policy arguments for or against them. Of particular concern to NTEU are the numerous proposals impacting federal employee pay and benefits as well as funding options for several agencies with NTEU members.
Federal Employee Proposals
The CBO report contains several items that affect federal employee pay and retirement, such as adopting a voucher plan to slow the growth of federal contributions for FEHBP (in general a voucher plan would replace the existing health plans and employer contribution levels for premiums with an annual payment requiring the individual to shop for a private health plan with a sizable diminished dollar amount from the employer), reducing the annual across-the-board adjustment for federal civilian pay by 0.5%, and prohibiting select federal agencies from hiring more than one employee for every two workers who leave until the workforce is reduced by 10 percent.
In addition, an option was included that would require most employees to contribute 4.4% of their salary to FERS, matching the percentage increased for employees who were hired after December 31, 2013. The increase for the rest of the population would be phased in over the next four years. The report also suggests changing the high-3 to high-5 in calculating the federal annuity to reduce the deficit. CBO also proposes eliminating the FERS supplement available to employees who retire before age 62, for those who retire in January 2019 or later. Many of these proposals mirror ones laid out in the President’s Fiscal Year 2019 budget request to Congress.
CBO did make clear that these changes would have ramifications on the ability of the federal government to attract and retain highly qualified individuals. As you know, NTEU has fought similar proposals for almost ten years and will continue to fight against the assaults on compensation for federal employees.
User Fee Proposals
The CBO report further proposes creating or increasing user fees at CFTC, FDA, and EPA. NTEU believes that the nature of the services provided by these agencies merits financing by user fees rather than taxpayer dollars. User fees create a more stable funding stream, relieves the taxpayer from financing what is service to a particular industry and better targets the agency’s work towards the purpose of the user fee.
As the 116th Congress gets underway, our nation will face an increasing deficit, which will likely impact White House and congressional funding and budgetary activity for 2020 and beyond. NTEU stands ready to continue the fight for adequate agency funding and against proposals that cut employee pay and benefits.