Federal employees fear more budget cuts

By BenefitsPro

By Paula Aven Gladych

Federal employees are nervous that any budget agreement that comes out of Congress this week will involve more cuts to their pensions.

Rep. Paul Ryan, R-Wis., and Sen. Patty Murray, D-Wash., who head up the congressional budget conference committee, have until Friday to present their budget compromise that would roll back the automatic spending cuts that went into place during the sequester and will continue to fund the government until Jan. 15, 2014.

The congressional budget conference committee is considering asking federal employees to contribute 1.2 percent more of their pay to their pension plans, a move that would save the government $20 billion over a decade. Those savings would be used to repeal part of the sequester cuts.

Unions that represent federal employees and some Congressional representatives are against the cuts because they say federal workers have already paid out enough, to the tune of $114 billion, with furloughs, a three-year pay freeze and changes to the pension plan for new hires.

Both Republicans and Democrats have agreed they want to eliminate another federal worker benefit, the FERS Annuity Supplement, for those employees who retire before age 62 and are not eligible for mandatory retirement.

The Senate budget plan disagrees with the House budget in that it doesn’t balance the budget on the backs of the federal workers.

Originally published on BenefitsPro.com