President Donald Trump told House Speaker Paul Ryan in a letter on Thursday that he is nixing pay raises for most civilian federal employees that had been planned for January. Citing budget concerns, the president informed Congress that a 2.1 percent across-the-board raise for most workers as well as separate locality pay increases averaging 25.7 percent can no longer be expected. “We must maintain efforts to put our Nation on a fiscally sustainable course, and Federal agency budgets cannot sustain such increases,” said Trump. Last year, Trump signed on to tax cuts that critics said will add about $1.5 trillion to federal deficits over 10 years.
The president cited what he called the “significant” cost of employing federal workers as his reason for eliminating the pay boost. He wrote that he wants federal employees to be paid according to their performance, while the government should seek to recruit, retain and reward “high-performing Federal employees and those with critical skill sets.”
“As noted in my budget for fiscal year 2019, the cost of employing the federal workforce is significant. In light of our nation's fiscal situation, federal employee pay must be performance-based, and aligned strategically toward recruiting, retaining and rewarding high-performing federal employees and those with critical skill sets. Across-the-board pay increases and locality pay increases, in particular, have long-term fixed costs, yet fail to address existing pay disparities or target mission critical recruitment and retention goals,” Trump wrote.
Democrats jumped to criticize the president while citing last year’s tax cuts for corporations and many taxpayers. “Trump has delivered yet another slap in the face to American workers,” said Democratic National Committee Chairman Tom Perez.
A Senate version of a general government appropriations bill calls for a 1.9 percent federal pay increase, which includes changes to both base and locality pay and matches the pay increase federal civilian employees got in 2018. The House version of the same legislation does not mention federal employee pay, which means that Trump’s push for a pay freeze will depend on which version of the bill is approved by Congress.
Vice Chairman of the Senate Appropriations Committee Patrick Leahy (D-Vt.) expressed support for the pay hike:
“The United States Senate has a long history of supporting the federal work force by providing competitive pay, which attracts and retains talented women and men to the United States government, who work every day to serve Americans. On Aug. 1, the Senate passed a pay raise of 1.9 percent with strong bipartisan support in a vote of 96 to 2. The Senate will continue to move forward on appropriations bills that have bipartisan support, that are at spending levels agreed to in the bipartisan budget deal and that reject poison pill riders and controversial authorizing language.”
Labor unions representing the 2 million federal workers called on Congress to pass the 1.9 percent pay raise. “President Trump’s plan to freeze wages for these patriotic workers next year ignores the fact that they are worse off today financially than they were at the start of the decade,” said J. David Cox Sr., president of the American Federation of Government Employees.
Meanwhile, Congress has approved legislation to give military service members a 2.6 percent increase, which is the biggest in nine years.
In July, the Trump administration revised its estimates of the federal deficit. That budget update projected a deficit of $890 million for the fiscal year that ends Sept. 30, which shows an increase from the February estimate of $873 billion. The $890 billion projection represents a 34 percent increase from the $666 billion in 2017. The administration is projecting the deficit for 2019 will exceed $1 trillion and float above that level for the next three years.