House Budget Plan Clears Way for Cuts to Federal Employee Benefits

A House approved budget plan paves the way for cuts to federal employees' retirement and benefits programs, Government Executive reported.

House members voted 219-206 on Thursday to approve a resolution outlining budget priorities, according to Government Executive. The resolution asks 11 committees to find $1.5 trillion in spending cuts through budget reconciliation.

While the resolution does not specify how the cuts should be made, White House officials earlier this year had proposed a 6 percentage point increase in employees' contributions to the Federal Employees Retirement System phased in over six years. And they suggested the elimination of the FERS supplement for employees who retire before Social Security begin at age 62.

The House budget plan also suggests cutting back the rate of return for the Thrift Savings Plan's G Fund, made up of government securities, to make it more in line to its low "investment risk profile," Government Executive reported.

Lawmakers also are discussing a change to how the government estimates it contribution to Federal Employees Health Benefits Program.

Jessica Klement, legislative director of the National Active and Retired Federal Employees Association, called the potential cuts "hypocrisy."

"This sets the stage for the federal community to pay for tax reform," she said. "You're paying for middle class tax cuts on the backs of middle class federal employees and retirees. It goes against the fundamental premise of this tax reform package."

And Rep. Gerry Connolly, D-Va., called the budget resolution "ruinous."

"Federal employee pay and benefits are not the cause of this country's deficit and debt," Connolly said. "The federal workforce has already contributed nearly $200 billion toward reducing the country's deficits in the form of pay freezes, pay raises insufficient to keep pace with inflation, furloughs and increased retirement contributions. We should honor and revere the service of our federal workforce, not denigrate it with the attacks included in this ugly budget."

The Hill noted a total of 18 Republicans voted against the budget resolution. All Democrats who were presented voted against it.

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