Comments on proposed pay increase for government employees, November 16, 1989.

Comments on Proposed Pay Increase for Government Employees

November 16, 1989

Yesterday, a bipartisan proposal to address the serious issue of government pay levels was made public. Although much attention has been devoted to the effect of the proposal on Congressional and Judicial salaries, its most dramatic and needed effect would be to increase the salaries of qualified government employees in the Senior Executive Service (SES). Tax Executive Institute believes that increasing salaries of SES employees is a necessary step in maintaining a competent, experienced, and professional civil service. We urge Congress to enact such increases.

Tax Executives Institute (TEI) is the principal association of corporate tax executives in the United States and Canada. The Institute's members are employed by 2,000 of the leading corporations in North America and represent a cross-section of the business community. TEI and its members deal with National Office and field representatives of the Internal Revenue Service on an almost daily basis, and we are dedicated to maintaining a tax system that works--one that is fair and administrable and with which taxpayers can comply. An essential ingredient to a viable tax system is a dedicated, qualified government workforce.

There can be no real debate that the pay levels of SES and other government employees are significantly lower than their counterparts in the private sector, with the disparities and inequities being more pronounced in some regions of the country than in others. In our view, the continuing pay differential has made it increasingly difficult for the IRS (and other government agencies) to attract and retain qualified employees, with the detrimental effect being most pronounced on talented middle managers: many have been forced to flee the government for higher-paying positions elsewhere. With no disrespect to the dedicated professionals now in government service, we believe it is essential to face up the blunt truth that Government--like all employers--gets what it pays for. If not adequately addressed, this situation could lead to a demonstrable diminution in the quality of government services.

TEI generally supports efforts to "decouple" the question of Congressional compensation from pay determinations affecting employees of the Judicial and Executive Branches. We believe that the linkage that exists today has contributed to the inequities in the current pay structure. Thus, we support periodic, separately enacted pay increases for SES and other Executive Branch employees. We recognize, however, that such separate legislation is not feasible during this Session of Congress. We therefore recommend enactment of the bipartisan proposal now before Congress.