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Trump cancels pay raise for federal workers

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Donald Trump

"We must maintain efforts to put our Nation on a fiscally sustainable course, and Federal agency budgets can not sustain such increases", said Trump.

An across-the-board 2.1% pay increase for federal workers was slated to take effect in January.

Specifically, I have determined that for 2019, both across the board pay increases and locality pay increases will be set at zero.

"The President and his party, which controls both houses of Congress, have had every chance over the last 18 months to get serious about tackling our fiscal challenges", Warner said in a statement.

Congress can override the president's pay freeze through legislation.

Sen. Benjamin L. Cardin, a Maryland Democrat representing many federal workers living in the D.C. area, quickly criticized the move. Senate and House negotiators will negotiate a final measure in the coming weeks.

For 2019, the administration is projecting the deficit will top $1 trillion and stay above that level for the next three years.

Trump cited the "significant" cost of employing federal workers as justification for denying the pay increases, and called for federal worker pay to be based on performance and structured toward recruiting, retaining and rewarding "high-performing Federal employees and those with critical skill sets".

The implications of Trump's decision on the locality pay increase were not immediately clear.

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Trump said he was axing a 2.1 percent across-the-board raise for most workers as well as locality pay increases averaging 25.7 percent and costing $25 billion.

Members of the military are still set to receive a 2.6 percent pay hike. Under the complex federal pay law, in that case such a message must be issued by the end of August to prevent a much larger raise from taking effect automatically should no decision be made by the end of the year. That measure was part of a four-bill, $154 billion package that passed the Senate 92-6 earlier this month.

The administration's July budget update projected a deficit of $890 million for the fiscal year that ends September 30, up from the February estimate of $873 billion.

"These numbers are very, very sustainable - this isn't a one-time shot", he said last month after figures showed the U.S. economy grew at a 4.1% annual rate in the second quarter of the year.

This is not the first time in recent history that a president has frozen civilian federal pay raises.

A federal judge overturned numerous provisions last week, and the administration says it will comply with the order. "Instead, the President ballooned the deficit by trillions of dollars with a tax giveaway primarily benefitting [sic] big business and the wealthiest Americans".

The Trump administration proposed $143.5 billion in cuts to federal employee compensation in May, including substantial decreases in retirement funding. A veto of a spending bill could lead to a federal government shutdown.

The state with the largest number of federal workers is California, followed by Virginia, the District of Columbia and Texas.

Trump is right to point out the scary fiscal situation.

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