White House Budget Would Harm Federal Employees, Deprive Taxpayers

Press Release February 10, 2020

Washington D.C. – The president’s proposed budget for fiscal year 2021 is once again distressing for federal employees because it would shrink take-home pay, reduce their retirement and leave their agencies with fewer resources with which to serve taxpayers, said NTEU National President Tony Reardon.

“Why must President Trump start every budget cycle with a slash-and-burn approach to federal government?” Reardon said. “Just like the last three years, NTEU will work with our allies on Capitol Hill to defeat these harmful proposals and ensure that federal employees are honored for their public service with fair pay raises and adequate resources for their agencies.”

As for the administration’s attempt to give federal employees a meager 1 percent across-the-board pay raise in 2021, it would be completely erased by the budget’s other retread proposal to increase what they pay toward retirement.

“Not only does 1 percent do nothing to close the gap between federal employee salaries and their higher-paid private sector counterparts, it won’t keep up with inflation, it won’t keep up with private sector wage increases and it is meaningless if they are forced to simultaneously shave money off their paychecks for higher retirement contributions,” Reardon said.

The budget proposal released Monday recommends that most employees contribute an additional 1 percent of their salary each year for several years toward the Federal Employee Retirement System. The result is consecutive 1 percent pay cuts in exchange for no increase in retirement benefits.

There are four other proposals that also weaken retirement benefits. They include eliminating or reducing cost of living increases for retirees; eliminating supplementals for early retirees; changing the benefit formula in way that lowers retirement benefits; and reducing the interest rate for certain Thrift Savings Plan investments.

The five proposals together would reduce federal employee retirement benefits by almost $180 billion over 10 years.

“For an administration that has added $3 trillion to the federal debt, gouging federal employee pay and benefits in the name of deficit reduction is ridiculous,” Reardon said. “NTEU will fight these regressive proposals on retirement while supporting existing legislation calling for a 3.5 percent pay increase in 2021.”

The budget would also modify the government contribution rate to the Federal Employees Health Benefits Program in a way that would require enrollees to pay significantly higher premiums.

Many NTEU-represented federal agencies are also on the White House chopping block, according to the budget proposal.

A cut of 26 percent is proposed for the Environmental Protection Agency. And Department of Energy programs outside the National Nuclear Security Administration would be slashed by 28.7 percent. The Department of Health and Human Services is recommended for a 9 percent cut.

At the IRS, the budget recommends an increase of $528 million over fiscal year 2020 levels, but it also envisions 1,183 fewer full-time employees, which directly contradicts calls by multiple government watchdogs to increase IRS staff and resources to improve customer service and enforcement of the tax code.

At Customs and Border Protection Office of Field Operations, the president’s budget does not include funding for the addition of any new Customs and Border Protection Officers to handle trade and travel at the nation’s 328 ports of entry, where staffing levels are dangerously short.

“Disrespect for federal employees is modus operandi in the Trump administration, but budget day has become especially unnerving for those who care about public service,” Reardon said. “For the fourth year in a row, President Trump’s budget proposal would starve federal agencies to the point of paralysis, pick the pockets of middle-class federal workers and their families, weaken our nation’s nonpartisan, merit-based civil service, and deprive Americans of the basic services and protections they expect from their government. Even if, as expected, Congress immediately ignores Trump’s outrageous budget blueprint, this is a stark reminder that the anti-employee agenda of this administration remains a constant threat.”

NTEU represents 150,000 employees at 33 federal agencies and departments.