3.5 Percent Raise is Safe

By on December 6, 2004 in Current Events with 0 Comments

The saga of the 2005 pay raise continues.

Unlike a private company where consultations and decisions on issues like pay are made in private, the federal government operates in a fishbowl–especially on issues that impact the government itself since nothing is likely to stay out of the public eye for long.

Last week, President Bush sent an alternative pay plan to Congress. Under the applicable statute, an alternative plan had to be submitted by the end of November.

This plan called for a 2.5 percent pay raise instead of the 3.5 percent that Congress approved earlier. The alternative pay plan was consistent with an earlier letter sent by the Office of Management and Budget to Congress urging the legislature to hold the federal pay increase to 2.5 percent.

An official of OMB told Government Executive last last week that “The alternative locality pay plan submitted to Congress prevents locality pay increases averaging 10.6 percent from taking place beginning in January.” And, the anonymous source told Government Executive, “Enactment of the omnibus appropriations bill will render the alternative locality pay plan moot. The plan was submitted just in case the omnibus is delayed past January 1, 2005. The alternative locality pay plan will almost certainly have no effect.”

The spending bill is being held up because of language “discovered” in the bill that would have increased access to tax information by Congressional representatives.

The bottom line: Most observers think the pay raise will still go through at 3.5 percent as approved by Congress a short time ago. The 3.5 percent increase will be the “average” increase for General Schedule employees. This number will be based on an across-the-board increase that will go to all GS employees and the locality pay adjustment based on where the employee works.

© 2016 Ralph R. Smith. All rights reserved. This article may not be reproduced without express written consent from Ralph R. Smith.

About the Author

Ralph Smith has several decades of experience working with federal human resources issues. He has written extensively on a full range of human resources topics in books and newsletters and is a co-founder of two companies and several newsletters onĀ federal human resources.