Possibility of Default Raise Arises

It is possible that Congress won’t be able to reach agreement with the White House on at least some spending bills and that those might be carried over into next year. If the general government bill is one of them, there could be a repeat of what happened in late 2002, 2003 and 2006 when no appropriations measure specifying a raise was enacted by the end of the calendar year. In each case, a raise took effect under a federal pay law formula. Congress acted early in 2003 and 2004 to boost the amount retroactive to the first pay period of the year but did not do so early this year, leaving a 2.2 percent increase in place rather than the 2.7 percent figure that had been under consideration for much of last year for the January 2007 raise. For January 2008, the default raise would be 2.5 percent, according to a congressional analysis.