GOP proposal would freeze federal pay, cut workforce by 10 percent

Meredith Shiner, staff writer, Roll Call

wfedstaff | June 4, 2015 2:34 pm

By Jack Moore
Federal News Radio

The federal pay freeze could get even colder and longer.

Senate Republicans are proposing an extension of the federal pay freeze in order to pay for a continuation of a payroll tax cut favored by congressional Democrats and the White House.

President Barack Obama enacted the current two-year federal pay freeze Jan. 1 as part of the recommendations made by the Bowles-Simpson debt-reduction commission.


Now Republican lawmakers have turned to those same recommendations as a way to pay for the extension of the payroll tax holiday.

The Temporary Tax Holiday and Government Reduction Act, introduced by Sen. Dean Heller (R-Nev.), pays for a one-year extension to the payroll tax holiday by extending the federal pay freeze for an additional three years and reducing the federal workforce by 10 percent — or 200,000 positions — through attrition

The GOP proposal would also prevent those earning more than $1 million from receiving unemployment benefits or food stamps.

The Democrats proposed to pay for the payroll tax cut with a 3.25 percent surtax on individuals or couples earning more than $1 million a year. Republican lawmakers say that could negatively impact small-business owners.

Rep. Chris Van Hollen (D-Md.) said the proposal would treat federal workers as a scapegoat.

“The Republican payroll tax proposal represents another cynical ploy to single out federal employees for unfair treatment,” Van Hollen said in a statement emailed to reporters. “The financial collapse and weak economy were not caused by the men and women who serve the federal government, and they should not be forced to shoulder the entire burden of the cost of recovery.”

Rep. Jim Moran (D-Va.) said he would oppose the GOP proposal.

“It’s just wrong to be providing a payroll tax cut to private sector employees at the expense of public sector employees,” Moran said in an interview with Federal Drive with Tom Temin and Amy Morris.

The National Treasury Employees Union similarly assailed the proposal.

“Continually freezing federal pay farther and farther into the future and cutting agencies that provide needed services to the public without asking the wealthiest Americans to share in the sacrifice at all is not what the majority of Americans support,” NTEU President Colleen Kelley stated in a release.

The Senate has scheduled a vote on the Democratic proposal for later this week, the Associated Press reports.

But Roll Call staff writer Meredith Shiner, in an interview on In Depth with Francis Rose, said there’s no clear path forward for either bill.

“I think that before Christmas you will see an extension of the payroll tax holiday … I don’t think you will see the ‘pay-fors’ that were proposed today,” she said. “I think they will find some sort of resolution that is easier for both parties to swallow. When and how that comes is unclear.”


GOP: Offsetting cuts must cover payroll tax relief