Pay Cuts & Security Clearances

Security clearances, for obvious reasons, have always been important in government. Now with the war on drugs and the war on terrorism, having trustworthy, happy people is more important, in more jobs, than ever before. Having a security clearance (along with government-backed health insurance for life) is very useful when feds leave government, or retire, for a related job in the private sector.

Private contractors love getting experienced feds with their talent, experience, connections and security track records. But are budget-cutters about to make things worse?

Are the must-have clearances going to be harder to get, and keep, in the future?

Some feds think actions taken by the White House and planned by Congress will make it tougher for feds walking a financial tightrope to get, or keep, a clearance. Consider:


Federal pay has been frozen for two years. Congress (which is fast-becoming a millionaires-only club) may extend that freeze. There is talk of eliminating within grade raises, etc. There are also plans (outlined here yesterday) to increase the retirement contribution of FERS employees.

If, and it’s a big IF, FERS contributions are increased it would reduce take-home pay. Take home is your real salary, that is money you touch, smell and spend. For some people, especially in the higher grades, that is chump change. For many, however, take-home pay at current levels is highly useful for things like eating, rent/mortgage and paying the electric bill, etc.

Taking a 5 percent cut, during a pay freeze, could sink some employees. Example:

  • ” It would be so unfair to force FERS employees to contribute more to their retirement. Does Congress know, or care, that the FERS benefit is about half that available to employees under the CSRS system? Does Congress know or care that FERS employees also pay the full amount into Social Security? Ninety percent of the people in my IRS office are under FERS. It has taken years to bring them up to optimal speed. Is Congress trying to drive them out of government?” – Ranger Rick
  • “I’ve enjoyed your coverage of possible changes to federal workers compensation. I’d like to suggest a story idea: How might these potential reductions in take-home pay (due to increased FERS contributions, increased health insurance premiums, etc.) affect feds’ abilities to hold security clearances? We all know that credit ratings come into play, and anecdotally there are many feds living paycheck-to-paycheck. I think you see where I’m going with this.” – Chris
  • A D.C.-based Justice Department employee said “Some of our agencies watching the Mexican border are having major problems because drug dealers are making a major effort to bribe U.S. employees either to look the other way, provide inside information, or for tips. Imagine what will happen if the pay freeze is extended and if they are forced to pay higher health premiums with a frozen and reduced paycheck?” – Tex-Mex Territory
  • “Places like the DEA, CIA and Homeland Security are very sensitive to the money-problems of employees. At the IRS people get fired for even tiny tax problems. Cutting pay at this stage of the game is a form of fiscal madness. Don’t the clowns on the Hill know what is going on in the real world?” – Art

So what changes are Congress and the White House looking at? We’ll ask the experts. Today at 10 a.m. on our Your Turn radio show Dan Adcock, legislative director of the National Active and Retired Federal Employees talks about plans to reduce future cost of living adjustments for retirees by as much as $1,500 per year. Steve Losey, senior writer and Steve Watkins, editor at the Federal Times, will talk about other benefits that may be on the chopping block and the status of hiring reform efforts.

Listen if you can (1500 AM or online), and if you have questions call in or e-mail me at


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