Unions ready to fight Bush management plan

Only a few months old, a Bush administration package of federal management reforms once touted as the means to a leaner, more efficient government could be losing some of its momentum.

The President's Freedom to Manage initiative, unveiled in August and introduced as two separate bills last month by Sen. Fred Thompson (R-Tenn.), usurps the role of Congress to decide when to expand new government programs and rewards senior federal executives at the expense of lower-level workers, the two largest federal employees' unions say.

When the two management reform bills were introduced, congressional supporters expected them to pass with little opposition. The rumblings of discontent, however, may signal that the initiative's path to the president's desk could be rockier than the administration anticipated.

Together, the two bills — the Managerial Flexibility Act and the Freedom to Manage Act — would group and make more widely available many flexibilities that already exist, according to administration officials.

The Managerial Flexibility Act would give federal managers tools and flexibility in areas such as personnel, budgeting, and property management and disposal. The Freedom to Manage Act would give the president authority to submit legislative proposals to eliminate or reduce legal barriers to efficient government, such as a law prohibiting the Agriculture Department from closing or relocating rural state offices. The proposals would be given "fast-track," or nearly immediate, consideration in Congress.

Sources on the Senate Governmental Affairs Committee, of which Thompson is the ranking member, characterize the two bills as an effort to make long-overdue changes to a host of minor rules and regulations that now serve as barriers to efficient management. "We are very optimistic about this legislation. We think its prognosis is excellent," said a senior committee aide.

The American Federation of Government Employees opposes the Freedom to Manage Act, however. "Fast-track authority is absurd," said Jacque Simon, public policy director for AFGE, which represents 600,000 federal workers. "If the idea [behind the initiative] is a good idea, we can't understand why it wouldn't survive the legislative process."

The National Treasury Employees Union (NTEU), which represents more than 150,000 federal employees, also opposes the initiative on a number of grounds. One of the union's main beefs is with the Managerial Flexibility Act, which would, among other things, raise salary caps and give improved vacation benefits to senior executives.

When it comes to recruiting, retention and pay issues, "I think it's a good thing if the administration is interested in addressing them, but they should be addressed for the total federal workforce — not just part of it," said NTEU's president, Colleen Kelley.

The unions have raised similar complaints many times in the past, and their concerns often are based in fact, said Donald Kettl, professor of political science and public affairs at the University of Wisconsin-Madison.

Expanding pilot projects, for example, threatens union members because there's no guarantee that workers in new programs will join the union. And ensuring that all workers — not just a select few — receive increased benefits is also an "understandable concern," he said.

"At the same time, my view is that we should not continue to allow these questions to stop the debate about reform," Kettl said. "We need to move to a new generation of relationships between government workers and the government itself, because to continue business as usual is no solution to dealing with the problems we face."

The unions charge that the initiative falls short on other issues. For example:

* The initiative gives authority to federal managers to pay recruitment, retention and relocation bonuses, but AFGE officials say that authority already exists in law and shouldn't be sub.stituted for the Federal Employees Pay Comparability Act.

* The governmentwide targeted buyout authority in the Managerial Flexibility Act allows for one-to-one reduction of full-time equivalent positions, which the unions oppose because it permanently eliminates jobs.

* The initiative usurps Congress' ability to make permanent changes to the federal personnel system and instead gives that authority to the Office of Personnel Management, in the opinion of both AFGE and NTEU officials, by making it easier for managers to institute "demonstration" projects that could then become permanent. Such projects include pay-banding, which allows managers to offer a range of salaries to employees within the same grade level.

* The initiative changes the way agencies must account for retirement and retiree health benefits so that when agencies are competing with the private sector for work, the agencies appear on paper to be the more expensive — and therefore less appealing — choice.

The need to hire more lower- and middle-level federal employees also outweighs the need to offer more benefits to senior executives, as the Managerial Flexibility Act would, Kelley said.

Office of Management and Budget Deputy Director Sean O'Keefe, who testified with Thompson and U.S. Comptroller General David Walker at a hearing held by the House Rules Committee Nov. 13, said the legislation would eliminate red tape and excessive bureaucratic control in the federal government.

"At a time of national emergency, it is critical that the government operates effectively and spends every taxpayer dollar wisely," O'Keefe said in prepared remarks.

With the imminent retirement of up to half of the federal workforce on the horizon, questions of hiring and retaining skilled employees and performing government operations efficiently loom ever larger, AFGE's Simon said.

***

Unions sound off

Several elements of the Bush administration's Freedom to Manage initiative have drawn complaints from the two biggest federal employees' unions. Among them:

* A provision making it easier to institute "demonstration" projects — and expand successful projects to other agencies — without congressional approval.

* A requirement that agencies fully account for the cost of retirement plans and retiree health benefits when bidding against the private sector for work.

* An increase in salary caps and vacation benefits for senior federal executives.

* A provision allowing agencies to offer larger recruitment and relocation bonuses, without providing extra funding for such bonuses.