White House looks to cut workforce, civilian-side funding

As part of its $4.4 trillion budget proposal, the White House is looking to cut retirement benefits for feds and take steps to peg pay to performance.

shutterstock ID 360126452
 

As part of its $4.4 trillion budget proposal for fiscal year 2019, the White House is looking to offset its bumps in military spending with deep cuts to federal workforce retirement benefits and civilian agencies' budgets.

This year, the budget arrived with an addendum from OMB chief Mick Mulvaney, which realigns the numbers to the top-line spending caps in the recently passed budget resolution.

While the budget document is a strong indicator of administration priorities, the House and the Senate will draft appropriations bills to fund agency activity.

"The committee will perform our own analysis and craft legislation that reflects the will of the House and the needs of the people we represent," said House Appropriations Chairman Rodney Frelinghuysen (R-N.J.) in a statement in response to the budget request.

Federal pay and benefits

In its proposal, the White House terms the current civil service system "a relic of an earlier era," and calls the laws and regulations surrounding hiring, pay, performance management and retirement "complex and outdated."

One of the proposed reforms to the civil service includes a pay freeze for civilian employees in 2019; military members, by comparison, would receive a 2.6 percent pay raise.

"We did not propose a civilian pay raise this year," Mulvaney said in a Feb. 12 press call. "Instead what we’ve done is set up a $1 billion fund with an idea toward giving managers the ability to give pay to people who actually merit the increase. Somewhere in the high 90’s of federal workers get programmatic performance based increases every year. I think it’s fair to say that’s probably not a true performance-based indicator."

The proposal also outlines significant cuts to federal retirement benefits. The White House estimates the proposed changes -- eliminating cost-of-living adjustments for Federal Employee Retirement System retirees; reducing Civil Service Retirement System retiree cost-of living adjustments to 0.5 percent; recalculating the pension formula from the average of an employee's three highest salary years to the five highest; increasing employee retirement contributions by one percent per year; and reducing the G-fund interest rate -- would save more than $2.5 billion in fiscal year 2019, and almost $84 billion over 10 years.

The pensions goal, according to the budget document, is to raise employee contributions to 50 percent of cost, which it says aligns more closely to private sector employment. The proposal also includes a carve-out to minimize the pain to feds in law enforcement and firefighting activities, although their contributions would continue to go up.

Overall, the administration's budget proposes cutting the number of full-time employees at the vast majority of cabinet agencies. The Departments of Commerce, Defense, Homeland Security, Labor and Veterans Affairs are the exceptions.

The budget also looks to reform the general schedule's compensation model and make it easier to hold employees accountable.

"This is yet another area where the Federal workforce could benefit from adopting some private sector norms," the proposal reads.

The National Treasury Employees Union, which represents 150,000 federal employees across 32 departments and agencies, released a statement blasting the budget proposal.

"Taken together, these proposals represent a full-scale assault on what has been a bedrock of our democracy: a civil service made up of skilled professionals who are committed to the taxpayers they serve, not the politicians," said NTEU President Tony Reardon. "Weakening our civil service system and attacking the pay and benefits of federal workers will backfire and leave our country unable to tackle the complex issues we are facing… NTEU will fight these proposals."

The Office of Personnel Management also released its strategic plan for fiscal years 2018 through 2022. Its Agency Priority Goals include making it easier — using paperless processing — for federal employees to transfer from one agency to another, modernizing the hiring process and adopting human capital analytics, improving communication between OPM and other agencies, as well as making agency processes more efficient.

The White House also proposes massive savings through its agency reorganization plans.

While light on agency-by-agency specifics, the budget estimates through reorganizing and cutting non-defense appropriations by two-percent every year, it will achieve $32 billion in savings in fiscal year 2018, another $27 billion in fiscal year 2019, $438 billion through 2023, and nearly $1.5 trillion in 10 years.

Robert Shea, a principal of Grant Thornton's public-sector practice, said he was "skeptical about the accuracy and ambitiousness of those numbers."

"I think it's going to be really difficult to get a lot of savings from reorganization, certainly on the front end," he said. "On the front end, it's actually going to take a bigger investment to get there."

In the budget proposal, the only non-defense agencies that enjoy a budget increase over fiscal year 2017 enacted levels are the Departments of Veterans Affairs, Homeland Security and Commerce.

And most of Commerce would actually see cuts. The White House proposes a $600 million -- or 0.6 percent -- increase for the department over its fiscal year 2017 enacted budget. However, that number is buoyed by a requested $2.3 billion increase for the Census Bureau.

The Environmental Protection Agency (about 25 percent), as well as the Departments of State (about 23 percent), Agriculture (about 16 percent) and Housing and Urban Development (about 14 percent) also face steep cuts.

For the second consecutive year, OMB requested a $8 million increase over its FY2017 enacted level of $95 million.

NEXT STORY: Challenges facing the new CIO

X
This website uses cookies to enhance user experience and to analyze performance and traffic on our website. We also share information about your use of our site with our social media, advertising and analytics partners. Learn More / Do Not Sell My Personal Information
Accept Cookies
X
Cookie Preferences Cookie List

Do Not Sell My Personal Information

When you visit our website, we store cookies on your browser to collect information. The information collected might relate to you, your preferences or your device, and is mostly used to make the site work as you expect it to and to provide a more personalized web experience. However, you can choose not to allow certain types of cookies, which may impact your experience of the site and the services we are able to offer. Click on the different category headings to find out more and change our default settings according to your preference. You cannot opt-out of our First Party Strictly Necessary Cookies as they are deployed in order to ensure the proper functioning of our website (such as prompting the cookie banner and remembering your settings, to log into your account, to redirect you when you log out, etc.). For more information about the First and Third Party Cookies used please follow this link.

Allow All Cookies

Manage Consent Preferences

Strictly Necessary Cookies - Always Active

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data, Targeting & Social Media Cookies

Under the California Consumer Privacy Act, you have the right to opt-out of the sale of your personal information to third parties. These cookies collect information for analytics and to personalize your experience with targeted ads. You may exercise your right to opt out of the sale of personal information by using this toggle switch. If you opt out we will not be able to offer you personalised ads and will not hand over your personal information to any third parties. Additionally, you may contact our legal department for further clarification about your rights as a California consumer by using this Exercise My Rights link

If you have enabled privacy controls on your browser (such as a plugin), we have to take that as a valid request to opt-out. Therefore we would not be able to track your activity through the web. This may affect our ability to personalize ads according to your preferences.

Targeting cookies may be set through our site by our advertising partners. They may be used by those companies to build a profile of your interests and show you relevant adverts on other sites. They do not store directly personal information, but are based on uniquely identifying your browser and internet device. If you do not allow these cookies, you will experience less targeted advertising.

Social media cookies are set by a range of social media services that we have added to the site to enable you to share our content with your friends and networks. They are capable of tracking your browser across other sites and building up a profile of your interests. This may impact the content and messages you see on other websites you visit. If you do not allow these cookies you may not be able to use or see these sharing tools.

If you want to opt out of all of our lead reports and lists, please submit a privacy request at our Do Not Sell page.

Save Settings
Cookie Preferences Cookie List

Cookie List

A cookie is a small piece of data (text file) that a website – when visited by a user – asks your browser to store on your device in order to remember information about you, such as your language preference or login information. Those cookies are set by us and called first-party cookies. We also use third-party cookies – which are cookies from a domain different than the domain of the website you are visiting – for our advertising and marketing efforts. More specifically, we use cookies and other tracking technologies for the following purposes:

Strictly Necessary Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Functional Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Performance Cookies

We do not allow you to opt-out of our certain cookies, as they are necessary to ensure the proper functioning of our website (such as prompting our cookie banner and remembering your privacy choices) and/or to monitor site performance. These cookies are not used in a way that constitutes a “sale” of your data under the CCPA. You can set your browser to block or alert you about these cookies, but some parts of the site will not work as intended if you do so. You can usually find these settings in the Options or Preferences menu of your browser. Visit www.allaboutcookies.org to learn more.

Sale of Personal Data

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Social Media Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.

Targeting Cookies

We also use cookies to personalize your experience on our websites, including by determining the most relevant content and advertisements to show you, and to monitor site traffic and performance, so that we may improve our websites and your experience. You may opt out of our use of such cookies (and the associated “sale” of your Personal Information) by using this toggle switch. You will still see some advertising, regardless of your selection. Because we do not track you across different devices, browsers and GEMG properties, your selection will take effect only on this browser, this device and this website.