Archived National Association of Postal Supervisors Legislative Report

Deficit Commission Proposes Big Hits on Feds and Postal Workers, Retirees

The co-chairs of the National Commission on Fiscal Responsibility on Wednesday released their recommendations for significant savings in federal spending. As feared, the proposals would bring significant pain to the active and retired federal and postal workforce.

Co-commission chairs Erskine Bowles and former Senator Alam Simpson in a preliminary document proposed:

— A 3-year pay freeze on all federal employees;

— A 10% cut in the federal workforce;

— Increasing the federal “high-3” retirement formula to a “high-5” approach;

— A significant increase in federal and postal employee contributions for retirement benefits;

— Lower federal civilian and military retiree benefits, and

— Increases in federal and postal retiree premiums for health benefits.

In addition the co-chairs would curb Social Security benefits and eliminate up to $100 billion annually in various tax breaks.

Whether these draft recommendations become the final recommendations of the commission is highly uncertain. President Obama’s directive establishing the deficit commission and appointing its 18 members requires 14 of the panel’s 18 members to agree to any proposal for it to become the commission’s official recommendation.

The scary prospect for federal and postal employees is that even if the deficit commission fails to reach agreement on changes in some controversial areas affecting all Americans — like the changes to the tax code or Social Security benefits — the commission could still go ahead and zero-in on federal workforce pay and benefits, and recommend changes there. Any deficit commission recommendation would still need to be approved by Congress and signed-off by the President.

The commission is required to file its report with President Obama by December 1st. House Speaker Nancy Pelosi (D-CA) previously pledged to bring to a House vote before the end of the year on any proposals officially proposed by the commission.

NAPS is closely monitoring the work of the deficit commission and will continue to advocate for the preservation of postal pay and benefits. NAPS joined with 17 other federal and postal employee groups last month in urging the commission to respect the value of public service and the solvency of the health insurance and retirement systems that cover federal and postal workers and retirees.

Bruce Moyer