Fiscal issues put federal workers in crosshairs — again

If Congress doesn’t raise the nation’s debt ceiling, which limits the amount Sam can borrow to pay his bills, Obama made it clear that federal employees will be among those who suffer.

“If congressional Republicans refuse to pay America’s bills on time, Social Security checks and veterans’ benefits will be delayed,” Obama said. “We might not be able to pay our troops, or honor our contracts with small-business owners. Food inspectors, air traffic controllers, specialists who track down loose nuclear material wouldn’t get their paychecks.”

The debt ceiling is separate from another looming crisis, potential across-the-board budget cuts. Take a look at what’s percolating at the Defense Department.

It’s the largest government agency, and what it does can be an indication of what’s in store for employees across the government.

That’s one reason Defense Secretary Leon E. Panetta’s “strictly precautionary” plan to deal with possible budget cuts is noteworthy.

“This includes a plan to implement potential unpaid furloughs for our civilian personnel if sequestration is triggered,” he said at a news briefing last week.

Sequestration is the across-the-board budget reduction that would hit federal agencies by March 1 unless Congress acts. The Defense Department cut would be about $52 billion through the end of this fiscal year.

At the direction of the Office of Management and Budget, the Pentagon, like other agencies, told its employees last month that “should we have to operate under reduced funding levels for an extended period of time, we may have to consider furloughs or other actions in the future.”

Just before Congress and the Obama administration reached an agreement that delayed sequestration two months, from Jan. 1, my colleague Ernesto Londono quoted a Defense official saying that under sequestration “over 800,000 civilian employees could face furloughs.”

There’s no way pain can be avoided with cuts like that. But the pain could be spread more fairly than Panetta’s plan calls for, according to the American Federation of Government Employees.

The union says the Pentagon’s budget plan shows “unapologetic bias in favor of contractors, regardless of cost.”

In a statement Friday, the union said Panetta’s plan would place an unfair burden on the civilian workforce, compared with agency contractors.

“Despite the fact that contractors make up 70 percent of the Pentagon’s costs for delivering services, while federal employees make up just 30 percent, [the Defense Department] is requiring components to reduce the cost of the civilian workforce without any remotely equivalent requirement to reduce contractor costs,” according to the labor organization.

Lt. Col. Elizabeth Robbins, a Defense press officer, said via e-mail that the guidance provided by Panetta “includes the curtailment of travel and conferences, the curtailment of facilities maintenance and repair (which is largely done by contractors), curtailment of supply purchases and business IT (also largely contractor provided), requires the review of all contracts for possible savings, and the requirement to clear all contracts over $500 million with the Defense Acquisition Executive. All of these actions will reduce contractor costs significantly. Therefore, there is no way to conclude that the guidance targets civilian employees in any disproportionate manner.”

To minimize the impact on civilians, the union suggested that Defense:

l“Freeze new service contracts.”

l“Prohibit the conversion of work performed by temporary federal employees or term employees to contractors.”

l“Ensure that no portion of functions performed by both federal employees and contractors be shifted from federal employees to contractors, so equal or greater cuts must come from the contractor workforce.”

l“Match any reduction in federal employee costs that is achieved by furloughs with cuts in service contract expenditures.”

Union President J. David Cox Sr. said, “Cordoning off contractor costs and focusing almost exclusively on cutting just federal employees is bad budget policy. Worse, it will force more extensive cuts in services for each dollar eliminated than if the costs of contractors were subject to the same level of cuts as civilian employees.”

Speaking of cuts to civilian employees, the National Treasury Employees Union is protesting a separate attempt to hit up federal employees to fill budget holes. This time it’s a Republican congressman’s plan to take money from transit benefits for feds and slice federal agency budgets to fund relief for victims of Hurricane Sandy.

In a letter to Congress, union President Colleen M. Kelley said a proposal by Rep. Mick Mulvaney (S.C.) would require cuts of 1.63 percent for all agencies. That “would only further impede the federal government’s ability to continue providing the critical services the American people rely on, whether it is securing our nation’s border, ensuring our food supply is safe, or protecting consumers and investors,” she said.

Another Mulvaney proposal to offset the cost of emergency aid by eliminating the federal worker transit benefit would single out and punish them, she added.

This, Kelley said, would “unfairly target employees who have already sacrificed so much in recent years.”

The congressman said he thinks the government can provide storm relief “while finding ways to pay for it.”

For Mulvaney, one way is to tap the wallets of federal workers.

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