2004 Raise Proposal Could Be Around 2 Percent

With just more than a week remaining before the Bush administration releases a budget proposal for fiscal 2004-the government budget year starting October 1-officials say that prospects remain that the White House will recommend a January 2004 federal raise of only about 2 percent. According to federal pay law, which has never been followed fully, employees are in line for a 2.7 percent across-the-board increase, plus locality pay. However, officials say the administration is working to hold down spending and that it might argue a raise of about 2 percent is sufficient, given the low rates of inflation and federal turnover. The administration also likely would argue that where the government is having problems in recruiting and retaining employees, agencies could use flexibilities already available to them, such as recruiting and retention payments, student loan repayments and other alternative forms of compensation.