The proposal overall would increase defense spending by 13 percent while cutting non-defense agencies by some 23 percent (except for DHS). Image: William Sawalich/Shutterstock.com
By: FEDweek StaffPresident Trump has issued a preliminary budget proposal for the fiscal year starting in October, calling for no pay raise for federal employees in January but substantial cuts in funding for non-defense agencies.
The “skinny” budget proposal is to be followed by a more detailed one that addresses additional federal workplace benefits and management issues. In his first term, Trump repeatedly included proposals similar to those recently approved by a House committee for inclusion in a bill being crafted there to serve as a 10-year budgetary outline.
A salary freeze would effectively be a cut for some federal employees if that package becomes law. It would require an increase in January 2026—to be followed by another in January 2027—of 1.8 percentage points in required contributions toward retirement by those first hired before 2013 and who currently are paying 0.8 percent of salary toward their future FERS annuities.
In contrast to federal civilian pay, the proposal says it “recognizes America’s servicemembers’ sacrifice to the Nation with a 3.8 percent pay raise.” That would be the starting figure for consideration of a January 2026 federal employee raise as indicated by the federal pay law.
The proposal overall would increase defense spending by 13 percent while cutting non-defense agencies by some 23 percent. However, the non-defense side includes DHS which would be in for an increase of some 65 percent, mostly for border enforcement and immigration-related policies. Apart from DHS, the non-defense side would see a reduction of about a third.
The proposal contains few details regarding how those levels would translate into employment levels, in a period that would be after the substantial cuts now underway or just ahead at many agencies, including DoD. It does call for a reduction in TSA screener jobs but an increase in FAA air traffic controller positions.
The increased funding at DHS also likely would translate into more jobs at agencies such as the CBP, Border Patrol and ICE, but cuts are envisioned in funding, and likely personnel, in other components such as FEMA and CISA.
The proposal also calls for “sufficient resources for the Social Security Administration to improve customer service by expanding and improving online services, and reducing customer wait times in field offices and on the phone” even as the agency has announced plans to eliminate some 7,000 of its 57,000 positions and close six of its 10 regional offices.
It further calls for: consolidating into the Interior Department the federal wildland firefighting agencies of Interior and the Agriculture Department; continuing moves to eliminate DEI considerations from federally sponsored grants and other programs; merging USAID into the State Department; giving veterans under VA care greater flexibility in getting that care from other providers; and eliminating numerous social and environmental loan and grants programs.
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See also,
How Do Age and Years of Service Impact My Federal Retirement
The Best Ages for Federal Employees to Retire
FERS Retirement Guide 2025 – Your Roadmap to Maximizing Federal Retirement Benefits
