NARFE: President Trump’s FY20 Budget Is a Direct Attack on Public Service

With President Trump’s fiscal year 2020 (FY20) budget request to Congress proposing substantial cuts to earned federal retirement and health benefits, National Active and Retired Federal Employees Association (NARFE) National President Ken Thomas issued the following statement:

“Federal employees and retirees serve this country proudly, working hard over long careers. In exchange for that service, our government provides modest pay, which often lags behind comparable private-sector jobs, and the promise of future benefits in retirement. President Trump’s budget breaks promises to both current and future retirees, reneges on commitments made to our nation’s public servants, and sends a very powerful message about the value this administration places on civil service.

“Public service has rarely been more denigrated and taken for granted than it is today. Federal agency functions and employee morale were crippled by a 35-day government shutdown, the longest in our nation’s history, and remain in recovery. The drastic cuts proposed in the president’s budget only will further undermine the strength of our civil service.

“America’s greatest strength is in its people. We must harness that strength through our federal workforce. If this administration continues to belittle and dismiss public service, we will be left without the talent we need to meet our nation’s challenges. It is clear that this budget is not the path forward.

“Particularly revealing in the budget is that these cuts appear under the authority of the General Services Administration, instead of the Office of Personnel Management, which currently administers these programs. It is clear the Administration intends to proceed with eliminating OPM and roll these programs into GSA without proper congressional oversight or approval. NARFE strongly objects to the Executive Branch unilaterally reorganizing federal agencies without input from stakeholders and Congress.”

Background

NARFE objects to the following fiscal year 2020 budget proposals, which amount to more than $177.1 billion in cuts to earned federal benefits:

•    Eliminating cost-of-living adjustments (COLAs) for current and future Federal Employees Retirement System (FERS) retirees.
o    Over a 30-year retirement, a typical FERS retiree – with a median annuity of roughly $1,000 per month – could lose nearly $250,000 due to this proposal.
•    Reducing COLAs for Civil Service Retirement System (CSRS) retirees by 0.5 percent each year from what the COLA would have been otherwise. When combined with the elimination of the FERS COLA, this would cost federal retirees $56 billion over 10 years, and much more thereafter.
o    Over a 30-year retirement, a typical CSRS retiree – with a median annuity slightly above $3,000 per month – could lose nearly $170,000 due to the proposal.
•    Federal employees covered under FERS would see employee contributions to their annuities increased by 1 percent each year for the next six years, without any corresponding benefit increase. This will cost FERS employees $78.8 billion over the next 10 years, and more thereafter.
•    The earned and fully funded FERS Annuity Supplement would be eliminated for new retirees. This benefit, provided to FERS employees who retire before they are eligible to collect Social Security, would hit those with a mandatory retirement age – such as federal law enforcement officers and air traffic controllers – the hardest, costing federal retirees $18.6 billion over the next 10 years.
•    Reducing the rate of return on the Thrift Savings Plan’s Government Securities Investment (G) Fund. This would cost federal employees and retirees, as well as military personnel and veterans, $16.5 billion over the next 10 years.
•    Federal pensions for new retirees would be based on the average of the highest five years of salary instead of the highest three. This would cost federal retirees $7 billion over the next 10 years.
•    Reducing working and retirement-age benefits for federal workers disabled through their service, costing them $220 million over 10 years.

The full budget, expected to be released next week, may contain additional, objectionable proposals that were not included in the documents released this week.
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The National Active and Retired Federal Employees Association (NARFE), one of America’s oldest and largest associations, was founded in 1921 with the mission of protecting the earned rights and benefits of America’s active and retired federal workers. The largest federal employee/retiree organization, NARFE represents the interests of 5 million current and future federal annuitants, spouses and survivors.

CONTACT:
Jill Talley
NARFE Director of Public Relations
jtalley@narfe.org
(703)838-7760