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UNION APPLAUDS SENATE FOR PASSING SHARP REDUCTION IN TAXPAYER-FUNDED CONTRACTOR COMPENSATION

FOR IMMEDIATE RELEASE:                                       

Dec. 5, 2011

Contact: Tim Kauffman

202-639-6405/202-374-6491

kaufft@afge.org

 

 

UNION APPLAUDS SENATE FOR PASSING SHARP REDUCTION IN TAXPAYER-FUNDED CONTRACTOR COMPENSATION

Capping taxpayer share of Defense contractor salaries at $400K would save billions

WASHINGTON – The nation’s largest federal employee union today commended a bipartisan group of senators for securing passage of an amendment to the 2012 National Defense Authorization Act that would sharply lower the compensation that all Defense contractors can charge taxpayers.

The American Federation of Government Employees for years has been calling attention to runaway contractor payments. Government contractors currently can charge taxpayers $693,951 a year for each of their five most highly paid executives, a benchmark that has more than doubled during the past 12 years. Other contractor employees are not subject to the cap and can earn far larger salaries that are subsidized by taxpayers.

On Dec. 1, the Senate approved legislation capping the reimbursement rate at the president’s salary, currently $400,000, and applying it to all defense contractor employees. Lowering the cap would not limit how much these contractor employees can earn, only how much can be charged to the government.

“Federal employees have had their own salaries frozen for two years to help reduce the deficit, yet nothing is being done to trim out-of-control contractor spending,” AFGE National President John Gage said. “Taxpayers should not be on the hook for these outrageous salaries that no one in government earns – not federal employees, not members of Congress and not even the President of the United States.”

The Commonsense Defense Contractor Compensation amendment to S. 1867 was introduced by Sens. Barbara Boxer, D-Calif., Charles Grassley, R-Iowa, and John Rockefeller, D-W.Va., and cosponsored by Claire McCaskill, D-Mo., Daniel Akaka, D-Hawaii, Al Franken, D-Minn., Sherrod Brown, D-Ohio, Jon Tester, D-Mont., Bob Casey, D-Pa., and Debbie Stabenow, D-Mich.

Senate Armed Services Committee Chairman Carl Levin, D-Mich., has vowed to fight for the provision when the bill goes to conference with the House.

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The American Federation of Government Employees (AFGE) is the largest federal employee union, representing 625,000 workers in the federal government and the government of the District of Columbia.

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