WASHINGTON — U.S. Defense Secretary Chuck Hagel announced Tuesday that he was slashing the amount of unpaid leave 650,000 civilian employees were ordered to take this year to six days from 11 in an effort to limit the pain from across-the-board budget cuts.
The decision means most civilian defense employees, who saw their pay effectively cut by 20 percent, will complete their furloughs next week.
The news was received warmly at Joint Base Lewis-McChord, where a large civilian workforce helps make the base the largest employer in Pierce County.
Last month, more than 10,000 civilian employees at Lewis-McChord started taking one unpaid day off each week — Fridays, for most workers. It was supposed to continue until Sept. 30.
‘GREAT NEWS’ FOR THOUSANDS
“This is great news for our thousands of civilian employees base-wide who have taken an unpaid day off each week since the week of July 8th,” Col. Charles Hodges, Lewis-McChord’s installation commander, said in a statement.
“Moreover, this is very good news for the approximate 150,000 Service members, military families, retirees, and many others who rely on the services provided by our civilian employees every day,” he added.
Regular civilian operations should resume at the base south of Tacoma the week of Aug. 19, Hodges said.
Hagel ordered the unpaid leave May 14 after the Pentagon was hit with a $37 billion budget cut in March, nearly halfway through its fiscal year. The cuts led the Navy to halt deployments, the Army to cancel training, the Air Force to ground aircraft and the Pentagon to furlough most civilians.
“This has been one of the most volatile and uncertain budget cycles the department … has ever experienced,” Hagel said in a memo. “While we are still depending on furlough savings, we will be able to make up our budgetary shortfall in this fiscal year with fewer furlough days than initially announced.”
‘TIME IS THE BEST BUDGET ANALYST’
While acknowledging that the reduction in furlough days might lead some people to accuse the department of exaggerating the scope of its earlier problem, senior defense officials said the Pentagon was looking at an $11 billion shortfall when it initially ordered the unpaid leave.
“Time is the best budget analyst. If you wait longer, you’ll know more,” said one official. “There were a whole bunch of things that broke in our favor, but three months ago, with $11 billion short, I don’t think we had a lot of choice.”
Reducing the unpaid leave will cost the department about $1 billion, senior defense officials said.
The Pentagon offset its budget shortfall and compensated for the reduced furloughs in several ways, including getting permission from Congress to shift $9.6 billion between accounts, mainly from acquisitions to daily operations, officials said.
The department was able to reduce spending in some areas, such as the cost of shifting equipment out of Afghanistan as the war draws down. Some funds were shifted among the military service branches and defense agencies, and the furloughs also saved money, the officials said.
“As a result, we were able to accomplish two goals: a reduction in furlough days, and a modest improvement in training and readiness,” Hagel said in the memo.
FURTHER HARDSHIP MIGHT BE IN OFFING
He noted that in recent weeks, some grounded Air Force squadrons had resumed flying, the Army had added training, and the Navy had restarted delayed maintenance and ship deployments.
While offering regrets for the unpaid leave, Hagel cautioned that continuing uncertainty regarding the fiscal year beginning Oct. 1 could lead to further hardship.
But he promised to do “everything possible to avoid more furloughs.”
The furloughs came as the Defense Department struggles to cut nearly $1 trillion from its projected spending over the next decade under a law passed in 2011 to try to reduce the government’s huge budget deficits.
The law required the department to cut $487 billion over a decade. It also directed the Pentagon to cut $500 billion across the board over the same time frame unless Congress and the White House agree on an alternative package to raise revenues or cut spending.
The sides have been unable to reach a deal, and Congress allowed across-the-board cuts to go into effect for the first time in March, but at a reduced amount of $37 billion because it was five months into the 2013 fiscal year.News Tribune staff contributed to this report.