FOR IMMEDIATE RELEASE
September 15, 2011
Tim Kauffman
202-639-6405/202-374-6491
kaufft@afge.org

Union Commends Lawmakers for Highlighting Runaway Contractor Salaries

WASHINGTON – The nation’s largest federal employee union today commended a group of lawmakers for calling attention to the rapidly escalating salaries that government contractors charge taxpayers.


Government contractors currently can charge taxpayers $693,951 a year for each of their five most highly paid executives, a benchmark that has more than doubled during the past 12 years. Other contractor employees are not subject to the cap and can earn far larger salaries that are subsidized by taxpayers.


The cap is set each year by the Office of Management and Budget’s Office of Federal Procurement Policy, typically during the spring. However, OFPP has not yet determined the cap for 2011. A trio of lawmakers – Sen. Barbara Boxer, D-Calif., Sen. Charles Grassley, R-Iowa, and Rep. Paul Tonko, D-N.Y., – sent a letter to OMB Director Jacob Lew on Sept. 15 calling on the administration to determine the cap as soon as possible.


“At a time when millions of Americans are unemployed, and millions more are taking home paychecks that don’t go as far as they used to, we ask you to determine the executive compensation benchmark for 2011. The American people deserve to know exactly how much government contractor executives will charge the taxpayer for their salaries this year,” the lawmakers wrote.


The American Federation of Government Employees, the nation’s largest federal employee union, for years has been calling attention to these runaway contractor salaries. In March, AFGE National President John Gage sent a letter to President Obama urging him to support limiting taxpayers’ reimbursement of contractor salaries at $200,000, which is the maximum salary for a Cabinet secretary.


“At a time of budget stringency, few parts of the budget or tax code should be off limits for scrutiny – and certainly not the lucrative salaries for contractors that are ultimately paid for through taxpayer dollars,” Gage wrote.

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