WASHINGTON -- President Barack Obama will propose a pay raise for federal civilian employees that is less than private-sector wage growth yet more than that favored by many House Republicans, who want to extend an employee pay freeze.
Obama will propose a 1 percent pay increase in the administration's fiscal 2014 budget plan, which is expected in mid-March.
At the same time, the House plans to vote soon on legislation that would extend the current freeze on basic pay rates through the end of the 2013 calendar year. The freeze was originally set for two years and had been scheduled to end in December but was extended until a temporary budget measure expires next month.
In April, federal employees will receive a 0.5 percent raise for the remainder of 2013, unless blocked by congressional action.
A 1 percent increase is less than the 1.8 percent raise that would kick in for 2014 under a law that requires a pay increase be pegged to wage growth in the private sector. Last year, wages in the private sector grew 1.8 percent.
The Pentagon's announcement this week of its intent to seek a 1 percent raise for the military in 2014 effectively set a cap for a 2014 civilian raise. In no recent year has the civilian raise exceeded the increase for military personnel.
For a number of years, civilian raises were set at the amount decided for military personnel under what was called "pay parity." But that practice broke down in recent years, as military personnel have continued to receive raises while federal civilian salary rates have been frozen.
Labor leaders learned late Friday about the raise in a conference call with the Office of Management and Budget. The presidents of the two largest federal unions said they are not happy with the small proposed increase.
J. David Cox Sr., president of the American Federation of Government Employees, said inflation has "gone up a lot more than that. . . . We're not going to be able to recruit the best and the brightest."
Colleen Kelley, president of the National Treasury Employees Union, said, "Already, federal employees have contributed more than any other group to address our fiscal deficit and economic circumstances -- $103 billion over 10 years from the pay freeze and from higher pension contributions from new federal hires. If followed, the formula under federal law would have provided a higher raise. By lowering the amount they are actually due, federal employees will contribute another $18 billion to budget savings, according to the Office of Management and Budget."
The National Federation of Federal Employees' president, William Dougan, was more positive.
"This adjustment, in addition to the proposed 2013 adjustment, would be a critical lifeline for federal employees across the nation who are struggling in this economy just like everyone else," he said. "Now it is up to Congress to support this year's federal pay increase and deliver our dedicated federal employees the adjustment they have earned."
Legislation sponsored by Rep. Ron DeSantis, R-Fla., would extend the freeze through 2013. When he introduced his bill last month, he said that "we simply cannot afford" the 0.5 percent hike. "This bill rescinds the president's action and makes clear that the federal workforce -- including Cabinet secretaries, members of Congress and other salaried employees -- will not receive an across-the-board pay increase this year."
But another Republican, Rep. Frank Wolf of Virginia, disagreed. In a letter sent Friday to his Republican colleagues, Wolf urged a "no" vote on the bill.
"Everyone knows they are an easy target," Wolf wrote of federal workers. "But we are kidding ourselves if we think we can balance the budget on the backs of federal employees. It's a drop in the bucket towards deficit reduction and a hollow gesture absent meaningful mandatory spending reforms. Worse, this is just busywork as our economy faces the sequestration meat ax."
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Eric Yoder contributed to this report.
WASHINGTON POST-BLOOMBERG--02-08-13 2102ET