'Back in Black:' Plan Would Freeze Federal Employees' Pay for Three Years

By on July 18, 2011 in Current Events with 85 Comments

Senator Tom Coburn, M.D. (R-OK) has released a new report called “Back in Black” that outlines how the federal government can reduce the deficit by $9 trillion over the next ten years and balance the federal budget.

The plan is lengthy and detailed, broken down into spending cuts in a number of agencies and categories. Cuts are proposed among the federal workforce, Congress, Executive Office of the President, the U.S. Judiciary, USDA, Education, DHHS, DHS, Labor, DOI, and Transportation to name a few.

As readers no doubt recall, the President’s deficit commission released a similar report in November of last year that had a number of recommendations on ways to cut federal spending. The suggestions ultimately went nowhere.

Just as with the commission report, federal employees should take note since there are some proposals in Coburn’s report that would directly affect them if enacted. Coburn has said himself that he doesn’t expect the plan to get through Congress, but he is simply trying to show the American people the kinds of cuts that he believes are possible and necessary to get the budget and the deficit under control.

“Both parties will no doubt criticize portions of this plan and I welcome that debate. My goal is not to replace the work of the budget committees but to show the American people what is possible and necessary. What is not acceptable, however, is not having a plan and delaying reform until some perfect political moment that will never arrive. The fact is doing nothing is a tax increase, a benefit cut for seniors and the poor, and a betrayal of the core values both parties hold dear,” said Dr. Coburn.

Here are some of the excerpts from the report that are likely to be of particular interest to employees of the federal government.

 

Three Year Freeze on Pay and Bonuses for Federal Employees

Federal workers receive an automatic annual increase known as a cost-of-living-adjustment (COLA). In addition, they can be eligible for recruitment, relocation, retention and performance bonuses worth many thousands of dollars more. In addition, this proposal would freeze other bonuses for the same period, saving taxpayers $144.4 billion over ten years.

 

Reduce the Size of the Federal Workforce by 15 Percent or 300,000

The National Commission on Fiscal Responsibility and Reform recommended a reduction in the federal workforce of ten percent or 200,000 by 2015. This proposal would reduce the federal workforce by 15 percent, or 300,000 federal employees, over ten years. The reduction would be accomplished through attrition and would allow agencies to hire two new employees for every three who have retired or left the federal government. In addition, this proposal would also require each agency to quarterly track the number of federal employees. In total, this reform will generate savings of $229 billion over ten years.

 

Reduce the Size of the Federal Contractor Workforce by 15 Percent

This proposal, similar to proposals from the Fiscal Commission and Professor Light, would require all federal agencies, including the Department of Defense, to cut the number of contract employee slots by 15 percent. In its final report, the fiscal commission called for cutting 250,000 contract employees, while Light recommended a reduction of 500,000. This proposal would save an estimated $233 billion over ten years.

 

Reduce and Restrict Government Printing

Encouraging federal employees to hit the print icon less every day could save taxpayers $440 million each year. A report finds that federal agencies – excluding the Department of Defense – spend nearly $1.3 billion a year on office printing. Of these printing costs, the study identifies $440.4 million a year – 34 percent –spent on unnecessary printing.

 

Reduce Civilian Agencies’ Travel Budgets by 75 Percent

The federal government’s annual travel budget is $15 billion, and has seen significant growth in the last decade. Non-defense travel grew from $3 billion in 2001 to over $5 billion in 2007. This proposal would reduce the travel budgets of civilian agencies by 75 percent. In addition to cutting the travel budget, the proposal would also require agencies to hold 10 percent of their travel budget in reserve until the last month of each fiscal year. Reducing the federal government travel budget would save $43.3 billion over ten years.

 

Eliminate Reemployed Annuitant Double Dip

Under current law, an agency must receive a waiver from the Office of Personnel Management (OPM) to rehire a retiree, also known as an annuitant. In most rehirings, the annuitant continues to receive a full annuity; however, the salary is reduced by the amount of the annuity payment. If an agency claims an urgent need, however, it can hire an individual with both a full salary and a full pension. Such cases, known as “double-dippers,” can cost the taxpayer over $55 million a year.

 

Reduce the Number of Limousines Owned by Federal Agencies

In the past two years, the federal government’s limousine fleet has grown by an astounding 73 percent. The government owned 238 limos in 2008, but by 2010, that number reached 412.

The winner of the most luxury limousine purchases goes to the State Department whose fleet grew from 65 limos in 2008 to 259 in 2010. According to the State Department, the most common type of limo purchased is a Cadillac that has a base price of $60,000. To set an example for the American people and remove the perception of government excess, the federal government should reduce the number of limousines down to 2008 levels and save $115.5 million over ten years.

 

Reduce Non-Limousine Federal Vehicle Fleet Budget by 20 Percent

This proposal echoes one made by the National Commission on Fiscal Responsibility and Reform.30 At last count, federal agencies owned or leased over 662,000 cars, vans, sport-utility vehicles, trucks, buses and ambulances. According to the Government Accountability Office, these vehicles consume about one million gallons of fuel per day. This proposal would not apply to the Postal Service or the Department of Defense. Reducing the federal vehicle fleet by 20 percent will save the federal government $5.6 billion over ten years.

Dr. Coburn introduced legislation to do this in the Senate in June.

 

Reduce Agency Advertising Budgets by 50 Percent

In 2010, the following five agencies spent the most for advertising:

  • Department of Defense: $545 million;
  • Department of Commerce: $148 million;
  • Department of Health and Human Services: $78 million;
  • Department of the Treasury: $46 million; and
  • Department of Transportation: $37 million.

By reducing agencies advertising budgets by 50 percent, it would save $5.6 billion over ten years.

 

Freeze Federal Locality Pay for Five Years

The Federal Employees Pay Comparability Act of 1990 created locality pay to align salaries for federal employees with private sector pay scales in their geographic area. According to the Office of Personnel Management, locality payments in 2011 were $13.7 billion. In fiscal year 2012, the total payments would be $27.2 billion due to an increase of $13.6 billion from 2011. Freezing locality pay would save an estimated $71 billion over ten years.

 

Reduce Annual Spending on Federal Government Conferences

This proposal would seek to curb the amount federal agencies can spend on conferences by limiting conference spending for the entire federal government to $100 million annually. The government spent at least $2 billion on conferences between 2000 and 2006. This is unacceptable given our current fiscal crisis. Reducing spending in this area will save at least $1 billion over ten years.

 

Ending Duplication in Federal Employment Agencies by Consolidating Functions at the Office of Personnel Management (OPM)

Federal employees and applicants for federal jobs are protected against discrimination, reprisal, and other prohibited practices by a number of independent executive branch agencies. Those agencies cost the taxpayer $487 million in 2010 alone.

Prior to the 1978 Civil Service Reform Act (CSRA), career executive branch employment affairs were handled by the U.S. Civil Service Commission, which sought to separate careers in government from the political pressures of the president’s immediate chain-of- command. The CSRA eliminated the Commission and replaced it with the Office of Personnel Management (OPM), the Federal Labor Relations Authority (FLRA), and the Merit Systems Protection Board (MSPB). In 1989, the MSPB was further divided and an independent Office of Special Counsel (OSC) was created.

In addition to the aforementioned agencies, the U.S. Office of Government Ethics (OGE) and Equal Employment Opportunity Commission (EEOC) are in place to advise and protect federal employees. Originally created in 1978 as part of OPM, OGE was made an independent agency in 1989 by the Office of Government Ethics Reauthorization Act of 1988, with the mission to prevent conflicts of interest on the part of government employees and to resolve those conflicts that do occur. Originally created as part of the Civil Rights Act of 1964, the EEOC exists to enforce federal anti-discrimination laws against both private and public sector employers.

A newly hired Federal employee would understandably be baffled by these divisions of labor, which may be why the MSPB and EEOC both go out of their way to emphasize “What We Do Not Do” – and identifies the other agencies’ roles.

Consolidating all of these agencies under the Office of Personnel Management would provide convenient “one-stop shopping” for Federal employees and applicants with conflicts, grievances, and whistleblower disclosures, and provide uniform guidance about ethical conduct. Combining these operations would reasonably be expected to save costs on multiple fronts, including but not limited to office rent, administrative and overhead costs, and personnel expenses.

While it is difficult to come up with a dollar amount to quantify the savings this proposal would create, it would eliminate layers of unnecessary bureaucracy and spending, significantly reduce rent and administrative costs, and make it easier for Federal employees to get the support they need in administrative matters.

This proposal would bring the independent executive branch agencies under one roof and reduce their budgets by 50 percent. This consolidation would save the federal government $2.7 billion over ten years.

 

Limit Carry Over of Unused Vacation Time and Cap Total Vacation Time at 30 Days/Year

A federal employee may use annual leave for vacations, rest and relaxation, and personal business or emergencies. Under current law, federal employees may carry over a maximum of 30 days if they are employed in the United States, 45 days if you are stationed overseas, and 90 days if you are a member of the Senior Executive Service (SES), or categorized by OPM as a “Senior Level” or “Scientific and Professional” employee.

While there has not been a cost savings determined, this proposal would save money while better aligning the federal government’s taxpayer funded benefits package with the private sector.

 

Freeze Pay for Members of Congress for Three Years

This is estimated to save $6 million. Additionally, Congress should completely repeal the provision of law that provides automatic pay adjustments for members.

 

Reduce the DoD Civilian Workforce by Five Percent Beginning in 2014

This is estimated to save $22.5 billion

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

About the Author

Ian Smith is one of the co-founders of FedSmith.com. He enjoys writing about current topics that affect the federal workforce. Ian also has a background in web development and does the technical work for the FedSmith.com web site and its sibling sites.

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