The House has cleared the way for Biden’s 4.6% pay raise plan

The House on Wednesday voted 220-207 to pass the first minibus fiscal 2023 spending package, effectively endorsing President Biden’s plan to increase federal employees’ pay by an average of 4.6% next year.

The minibus contains six of the 12 annual appropriations bills, including transportation, housing and urban development; agriculture and rural development; energy and water development; military construction and veterans affairs; and financial services and general government, the last of which serves as the vehicle for provisions impacting federal employee compensation.

When Biden first unveiled his fiscal 2023 budget request in March, he proposed providing an average 4.6% pay increase for federal civilian employees and members of the military. Although it is unclear how that figure would be split between an across-the-board increase in basic pay and an average increase in locality pay, presidents typically have set aside 0.5% of the overall raise for average locality pay increases.

A 4.6% average pay raise would mark the largest increase for civilian federal workers in more than two decades—President George W. Bush granted feds a 4.6% average raise in 2002—but some lawmakers and federal employee groups have advocated for an even larger raise of 5.1%, pointing to the paltry 1.0% across-the-board raise the workforce received in 2021 and lack of an increase to locality pay, as well as rising inflation. The 5.1% raise would have been split between a 4.1% across-the-board increase in basic pay and an average 1.0% raise in locality pay.

But throughout the House’s spending talks, appropriators failed to include any language on federal employee compensation. Since Congress must act affirmatively to override a president’s pay plan, that effectively serves as an endorsement of Biden’s proposal.

Prospects for a larger pay raise being included in the Senate’s version of the appropriations bill are dim. The Senate Appropriations Committee has yet to unveil any of its spending bills, but with Democrats only in control via the vice president’s role as tiebreaker of an evenly split chamber, it would be more likely to see the pay raise figure decrease in an effort to secure the 10 GOP votes needed to send the bill to the president for enactment.

The removal of a longstanding policy rider to the House’s version of the spending package could be a boon to federal employees’ non-salary benefits, although it is unlikely to make it into law. Appropriators did not include the Hyde Amendment, a decades-old stipulation that federal dollars cannot go toward abortions. Democrats have been pushing to repeal the provision for several years, although the effort took on renewed urgency with the Supreme Court’s controversial decision last month to overturn Roe v. Wade.

For federal employees, the Hyde Amendment carved abortion-related services out of the long list of procedures covered by insurance through the Federal Employees Health Benefits Program, forcing them to pay out of pocket to obtain those procedures.

Debate over the future of the amendment could be a sticking point in negotiations between House and Senate as the end of the fiscal year approaches in September.