Stillwater News Press

Our World

December 12, 2013

Federal budget deal would have new hires pay more into pensions

WASHINGTON — Federal employees hired after Jan. 1 will make higher contributions toward their retirement benefits than current workers under a budget deal announced Tuesday night.

Under the agreement reached by the Budget Conference Committee, the new workers would pay an additional 1.3 percent of salary toward retirement, saving the government $6 billion over 10 years.

While federal employee unions strongly pushed against any additional payments from the workforce, the agreement is a much better deal for them than what Republicans and even President Barack Obama had proposed.

Rep. Paul Ryan, R-Wis., chairman of the House Budget Committee, wanted federal employees to pay an additional 5.5 percent toward retirement, or $130 billion over 10 years. Obama's proposal was for a 1.2 percent increase for all federal employees, yielding $20 billion from workers.

"This has been a brawl over the last 48 hours," said Rep. Chris Van Hollen, D-Md., a member of the conference committee whose district is heavy with federal workers. "This agreement will not require additional contributions by any current federal employees."

The agreement would create a three-tier system for employee contributions to their civil service pensions. Those hired before this year pay 0.8 percent of their salary, those hired in 2013 pay 3.1 percent and those hired after Jan. 1 would pay 4.4 percent under the budget agreement.

Colleen Kelley, president of the National Treasury Employees Union, said she was "disappointed that the budget deal announced today proposes increases to federal employee retirement contributions for new hires; however, I am glad to see the numbers were significantly reduced from original proposals and that these retirement increases will not impact current employees.

"Considering the $114 billion current federal workers have already contributed to deficit reduction, it was the right decision not to ask them to sacrifice again," she said.

Van Hollen said Obama called from Air Force One, while traveling to South Africa for Nelson Mandela's funeral, to assure the congressman that the administration would not advance additional pension contributions from federal employees in its next budget proposal.

The budget agreement also would lower the compensation level the government pays to some outside contractors.

The compensation level, determined by a statutory formula, is now set at $952,308. The agreement, according to Van Hollen's office, would bring it down to $487,000.

Van Hollen said non-defense agencies would have $22.5 billion more in fiscal year 2014 than 2013, while the Pentagon will get $2 billion more.

"This should avoid furloughs in the coming year," he said.

The agreement has some good and some bad, he added, but on balance "it's a good step forward for the country."

Joseph Beaudoin, president of the National Active and Retired Federal Employees Association, said: "This deal continues with the dangerous precedent set by Congress last year in taking from future federal employees to pay for bad policies and deficit reduction now. . . . This drain on our nation's federal workforce must end. The federal government may never be the employer with the greatest pay and benefits, but it certainly shouldn't be the employer of last resort either, and that's where we are headed."

1
Text Only | Photo Reprints
Our World
Must Read
Buy & Share Photos
NewsPress e-Edition
NewsPress Specials
AP Video
'Modern Family' Star on Gay Athletes Coming Out MN Twins Debut Beer Vending Machine DA: Pa. Doctor Fired Back at Hospital Gunman Raw: Iowa Police Dash Cam Shows Wild Chase Obama Seeks Limits on US Company Mergers Abroad Large Family to Share NJ Lottery Winnings U.S. Flights to Israel Resume After Ban Lifted Official: Air Algerie Flight 'probably Crashed' TSA Administrator on Politics and Flight Bans Raw: National Guard Helps Battle WA Wildfires Raw: Ukraine's Donetsk Residents Flee Senators Push to End Hamas Threat in Cease-Fire A Young Victim's Premonition, Hug Before MH17 Raw: Deadly Storm Hits Virginia Campground Death Penalty Expert: 'This is a Turning Point' Raw: MH17 Victim's Bodies Arrive in Netherlands Raw: Families Travel to Taiwan Plane Crash Site Arizona Execution Takes Almost Two Hours Crash Kills Teen Pilot Seeking World Record
Stocks
NDN Video
Bill Murray Continues To Be Just Bill Murray By Eating Some Free Bill Murray Ice Cream Deja vu: Another NYPD officer choke-holding a suspect Hillary Clinton Blamed Bill's Affair With Monica Lewinsky On Abuse He Suffered As A Child 'Fifty Shades of Grey': Watch the Super Sexy First Trailer Now! Reports: Ravens RB Ray Rice Suspended For 1st 2 Games Of The Season Chapter Two: Becoming a first-time director Air Algerie plane with 119 on board missing over Mali Diamond Stone, Malik Newman, Josh Jackson and others showcase talent Free Arturo - The World's Saddest Polar Bear A Look Back at Batman On Film Through The Years LeBron James -- Dropped $2k On Cupcake Apology ... Proceeds To Benefit Charity Snoop Dogg Says He Smoked Weed at the White House Raw: Fight Breaks Out in Ukraine Parliament Chris Pratt Interrupts Interview To French Braid Intern's Hair Shirtless Super Mario Balotelli Dances While Ironing - @TheBuzzeronFOX Whoa! Watch "Housewives" Star Do the Unthinkable LeBron apologizes to neighbors with cupcakes Justin Bieber In Calvin Klein Underwear Shoot Samsung Pre-Trolls The IPhone 6 With New Ad Jimmy Kimmel Introduces His Baby Girl