Federal Daily News
No clear clues for feds in deficit speech
While President Obama in a speech today laid out in broad terms his plan for a “comprehensive, balanced deficit reduction framework,” it is unclear how those reductions will specifically affect rank-and-file feds.
In a speech that focused in large part on Social Security, Medicare and tax reform, Obama provided a first look at a plan which he said would gradually phase in measures that would cut the federal deficit by $4 trillion in 12 years — in part by implementing some of the recommendations suggested last year by his deficit reduction panel.
But what that means to feds is yet uncertain.
There may be clues in the report issued last year by the president’s deficit commission. That report included a lot of tough proposals that would affect feds — including workforce cuts, a pay freeze and a recommendation to transform the Federal Employees Health Benefits Program into a “defined contribution premium support plan.” Such a plan would offer feds a fixed subsidy that would grow by no more than the gross domestic product, plus 1 percent each year. Federal retirees would be able to use that subsidy to pay for part of the Medicare premium.
But as yet, those remain just recommendations. Right now, it’s still anyone’s guess.