Draft spending bill cuts telework and bans transgender care for feds, but preserves 5.2% pay raise plan

President Biden’s plan to provide civilian federal employees with an average 5.2% pay raise in 2024 appears safe for now, as a key House panel advanced spending legislation that does not address federal employee compensation.

But Democrats and federal employee groups blasted the GOP-led appropriations package, which cuts spending on financial agencies and government administration by 58% compared with fiscal 2023 levels and includes policy riders restricting telework at federal agencies and targeting transgender federal workers and their family members.

The House Appropriations Committee’s Financial Services and General Government Subcommittee on Thursday advanced its annual appropriations bill—one of 12 such pieces of legislation covering different areas of government—to the full committee.

On the spending side, the bill rescinds money authorized by the Inflation Reduction Act to improve Internal Revenue Service staffing and rejects the Biden administration’s request for additional funding to support those investments over the next two years. It also withholds billions in funding for a new FBI headquarters. That last initiative was thrust into the appropriations debate after former President Trump was indicted in connection with his failure to return more than 300 classified documents, stored at his club at Mar a Lago, to the government.

The legislation proposes funding the Office of Personnel Management at fiscal 2022 levels, which marks a $49.2 million cut from current funding levels and a $134.7 million reduction from Biden’s budget request.

But one proposal subcommittee Republicans did not push back on was Biden’s plan to provide federal employees with an average 5.2% pay raise next year. That proposal, if implemented, would mark the largest raise for feds since the Carter administration granted feds a 9.1% average pay increase in 1980. Thus far, the administration has not specified what portion of the raise will be dedicated to across-the-board increases in basic pay, although traditionally presidents have set aside 0.5% of an overall pay raise figure for average boosts in locality pay.

The same cannot be said for those employees’ workforce policies or benefits. Among the many policy riders in the legislation are provisions directing federal agencies to roll back their telework policies to pre-pandemic levels within 30 days of the bill’s enactment, much like the House-passed SHOW UP Act, and placing new limits on how federal employees can use some of their non-salary benefits.

The bill includes the Hyde Amendment, a long-running policy rider preventing federal funding from going toward abortion services, including via the Federal Employees Health Benefits Program. And it introduces a new provision that would bar FEHBP from covering gender affirming care, such as surgery, hormone therapy or puberty blockers, for transgender federal workers or their family members.

Another provision would bar federal employees and retirees from investing in mutual funds that advance environmental, social or corporate governance principles, such as those that are divested from fossil fuel companies, as part of the Thrift Savings Plan’s mutual fund window. The bill also would block funding for the implementation of President Biden’s executive order promoting diversity, equity, inclusion and accessibility at federal agencies.

At a meeting to advance the legislation, subcommittee Chairman Steve Womack, R-Ark., described the myriad agency funding cuts as “right-sizing” a “bloated” bureaucracy and providing needed safeguards to workplace policies like telework.

“With the post-COVID working environment continuing to confound our economy, this bill directs agencies to return to reasonable telework levels in order to combat government inefficiency and limit the use of taxpayer dollars being used to pay bureaucrats to work wherever they prefer,” he said.

Rep. Steny Hoyer, D-Md., ranking member of the subcommittee, criticized Republicans for saddling the financial services and general governance legislation with the harshest cuts of any of the appropriation bills.

The Financial Services and General Government bill “got the smallest allocation and the largest cut of the 12 appropriations bills—the greatest proportional cut is sustained in this bill,” he said. “Why? Maybe because it’s not a popular bill, it’s not sexy . . . I’ve been on this committee for a very long time—this is my 24th year. And in my view, this isn’t a real bill.”

Tony Reardon, national president of the National Treasury Employees Union, described the cuts to OPM and policy riders targeting federal employee workplace flexibilities and other benefits as “destructive” to agency governance.

“The common thread throughout this legislation is that federal employees are expendable and don’t deserve the resources and support they need to get the job done,” Reardon said. “NTEU will continue to fight for federal agencies to have the personnel, technology and resources necessary to meet the needs of the American people.”