Federal Job Incentive Pay Proposed

President Bush, intent on breaking with the current seniority system, will initiate an incentive pay plan making high-performing and specially skilled federal workers eligible for raises.

“Most Americans recognize that the current pay system for the federal workforce is broken,” said Kay Coles James, director of the Office of Personnel Management, in outlining the new plan. Rewarding performance “is extraordinarily good news for the hard-working federal employee.”

Maryland Rep. Steny Hoyer, the House’s second-ranked Democrat, called the plan “totally unacceptable” and said it would face strong opposition in Congress.

James and Mark Everson, deputy director of the Office of Management and Budget, told reporters that Bush, in his proposal for the 2004 budget year coming out next month, will ask for a 2% pay raise for all 1.8 million civilian federal workers.

On top of that, they said, he will ask Congress to approve $500 million for a “human capital performance fund,” to be prorated to government agencies, to boost the base pay of the best workers. Everson, nominated by Bush as the next commissioner of the Internal Revenue Service, said Bush is determined to make the federal workforce more accountable. “The federal pay system has been in a time warp for over 50 years,” he said. “The president is committed to fixing it.”

The OPM would oversee plans submitted by the agencies on how they will reward high-performing or critical workers. James said agencies would not be allowed to use their shares of the fund for across-the-board raises.

The government spent about $100 billion this year for federal workers’ salaries.