Buyouts and broad bands

More buyouts, new broad-band pay systems and performance-based pay are on the horizon, as part of the Clinton administration's upcoming civil service reform proposal. But a look back at the history of civil service plans during the Clinton years shows that such ideas have come-and gone-before.

In 1993, the National Performance Review identified civil service reform as an important component of the reinventing government movement and began circulating draft proposals for legislative changes. Such changes require congressional approval, because many rules governing federal pay and benefits are set in statute. During 1994, the administration fleshed out the details of its reform plan.

In 1995, the administration sent the plan to Capitol Hill. It included proposals to streamline hiring and tie pay more closely to performance. The administration hailed the plan as the most sweeping change in the federal workplace since the Civil Service Reform Act of 1978, which created the Office of Personnel Management and the Senior Executive Service. But federal employee unions and Republicans, who took over Congress in the previous election, blocked the plan.

"There is no constituency for civil service reform except the American people," then-NPR chief Elaine Kamarck told The Washington Post. "This is one of those issues where we've got everybody upset, which means we're probably doing the right thing."

Regardless of whether civil service reform was the right thing to do, it was apparently the wrong time. The administration gave up on its plan.

"There was too little communication between Congress and OPM and NPR," said Rosslyn Kleeman, head of the Coalition for Effective Change, which includes 30 associations of federal managers and professionals. "There wasn't enough consultation ahead of time."

Instead, individual agencies sought out changes to pay and benefits rules. Some agencies created demonstration projects to test changes on employees. The Commerce Department, for example, started testing a broad-band system on portions of its workforce. Others received exemptions from Congress, including the Federal Aviation Administration and the Internal Revenue Service. The Education Department's student financial aid office will test pay-for-performance models as part of its designation as a performance-based organization, which Congress approved last year. The Defense Department is developing its own proposed pay and benefits changes for its civilian workforce.

Last summer, the House Government Reform and Oversight Subcommittee on the Civil Service proposed a package of three dozen civil service changes, including several that would give managers more control over employees' raises. That package fizzled amid union and administration opposition.

OPM told the House civil service panel that it was drafting legislative changes to the civil service system that would better tie pay to performance and make it easier for agencies to recruit and retain employees. OPM Director Janice Lachance last year laid out a timeline that foresaw a major overhaul proposal taking effect in 2002.

A rough outline of ideas OPM floated last year included broad-band authority, better performance management systems, and eliminating the right of employees to appeal denial of within-grade pay increases. OPM also suggested giving agencies permanent buyout authority.

Last week at his "Global Forum on Reinventing Government" in Washington, Vice President Al Gore significantly shortened OPM's timetable, saying the nation "cannot make the most of the information age with the creaking governmental machinery of the industrial age." Gore said the administration would propose a reform package this year that would tie pay raises to performance instead of allowing automatic seniority increases, permit agencies to replace the General Schedule with broad-banding pay systems, and streamline hiring procedures.

In background materials accompanying President Clinton's State of the Union address Tuesday, the White House also said "the administration will propose legislation creating new buyout authorities for agencies to reduce further the size of government."

Gore aide Morley Winograd said specific civil service reform proposals would start to take shape in the next few months.

Federal unions and management groups gave the administration's plan a lukewarm response, calling on the White House to include them in preparing of the civil service reform legislative package.

Whether civil service reform has a better chance now than in the past will depend on the details of the plan that will take shape over the next few months, observers say.

In a September report card on Gore's reinvention efforts, Brookings Institution scholar Donald Kettl said the Clinton-Gore vision of an "information age" government depends on changing the way public servants are paid, classified and rewarded.

"It is one thing to exhort government's managers to squeeze extra productivity from their budgets, to create a government that works better and costs less. It is another to ask them to create an information-age government within a civil service system created for horse-and-buggy days," Kettl said.