Costs for training, travel and upgrading office equipment commonly are among the first to be targeted. Image: David Orcea/Shutterstock.com
The spending limits under the debt ceiling law now in effect will act as the type of budgetary outline that Congress’s internal rules call for it to produce each spring, but which has commonly been bypassed in recent years. That provides amounts to be parceled out among the 12 regular appropriations bills, which then is divided among agencies covered by each bill, and then among the accounts within those agencies.
One key account, called “salaries and expenses,” covers pay and benefits costs for agency employees as well as expenses such as employee training and travel and general office expenses. Some of those costs, such as rent, are fixed, meaning that needed savings would have to come from elsewhere.
When limits are imposed on those accounts — as the debt ceiling law does for all agencies except DoD and VA — costs such as training, travel and upgrading office equipment commonly are among the first to be targeted. However, such limits also can trigger steps such as complete or modified hiring freezes and even furloughs and RIFs.
Said the Federal Managers Association, “We are very concerned about capping funding for all agencies except the Department of Defense and Veterans Affairs for fiscal year 2024 and the limits on future spending levels and what that means for staffing, compensation, and the operations of the federal workforce. This will exacerbate ongoing problems of recruitment and retention for federal managers and impact the services provided to the American people.”
The NFFE union had made similar comments even before the debt ceiling measure was approved.
The spending caps do not act as a direct limit on the potential size of the January 2024 federal employee pay raise—President Biden has proposed a 5.2 percent average boost—but the cost of the raise would have to be absorbed from those same accounts, increasing the pressure on them still further.
The key bill in which a raise could be set by law is the general government appropriations measure, which has not moved in Congress even at the subcommittee level. In many years Congress has allowed the President’s recommendation to take effect by default. However, a move to set a figure, presumably lower than Biden’s 5.2 percent number, could be made this year.
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