We know that the federal pay system has become more fragmented. Some agencies now effectively have their own pay systems and employees working in these agencies make considerably more than employees in larger agencies and, in some agencies, make less money while they have more responsibility. (See Federal Jobs With Highest Average Salary and Highest Bonuses)
No doubt, everyone would like to have a larger salary. How much is too much? The debate goes on each year with no resolution. Many readers complain that they are significantly underpaid and that they would make much more in the private sector while private sector studies have indicated that federal employees are frequently overpaid.
The Federal Retirement Thrift Investment Board (FRTIB) is a federal agency. The Thrift Savings Plan (TSP) is managed by an executive director. The executive director, according to the FedSmith database of individual federal employees, made about $165,300 in fiscal year 2013 and also received a bonus of $17,650.
At the last meeting of the FRTIB, the minutes noted that the TSP has grown to about $406 billion as of the end of April with a participation rate of 87.1%. For fiscal year 2013, the budget of the FRTIB was $153,000,000. It is projected to be about $201,000,000 in 2014. In fiscal year 2013, the average pay for agency employees was $107,560.93 for 161 employees.
The chairman of the FRTIB stated that the executive director was under compensated “when compared with similar public and private sector organizations.” The FRTIB chairman proposed to raise the executive director’s compensation to 120 percent of the Vice President’s salary. The Vice President of the United States has a base salary of $230,700. The chairman of the FRTIB is listed as a Senior Client Partner with Korn/Ferry International and, presumably, quite familiar with the salaries paid to executives of large pension funds outside of the government.
The minutes noted a comment that the Postmaster General’s salary was raised in 2006 to 120 percent of the Vice President’s salary. The Postmaster General in 2014 had a salary of $279,600.00 in 2014, again according to the FedSmith list of individual employee salaries.
So, presumably, under this proposal, the executive director’s salary would be raised to about $279,600 to match the postmaster general’s salary from the more recent executive director’s salary of $165,300.
A discussion was held in the meeting as to whether raising the salary as proposed would require a stand-alone legislative initiative or if it could be added to legislation to modify the default TSP account for new federal employees from the G fund to the appropriate L fund. It was not clear if this could be done but all options would be explored as possible avenues to raise the salary as discussed.
What is your view? Do you think the salary for the executive director of the Thrift Savings Plan should be raised to 120% of the Vice President’s salary? Take the poll below and send in your opinion.