taken the comparability line up to GS-15 and then just projected it statistically in order to get these levels.

Senator MONRONEY. Are step increases generally comparable to private industry?

Mr. MACY. Yes; generally private industry follows a rate increase or more than 3 percent, which is the amount that is written into the Salary Reform Act schedules as the difference between rates within a grade.

Senator MONRONEY. Thank you.

The CHAIRMAN. Senator Fong.

Senator FONG. Mr. Macy, would you say, taking a figure of $533 million in mind and taking the figure of $12 million in mind only for the executive, legislative, and the judiciary, that the reluctance really to achieve reasonable comparability is due to the fact that we have been reluctant to look at 22 percent of the $533 million which will give you the $12 million, to really look at that 22 percent, in a more realistic manner?

Mr. MACY. I would agree with that observation completely.
Senator FONG. Thank you.

The CHAIRMAN. I see our friend from West Virginia. Do you have some questions, Senator Randolph ?

Senator RANDOLPH. Mr. Chairman, I regret that I have not been privileged to listen to the statements of the Chairman of the Civil Service Commission, Mr. Macy. I presume, Mr. Macy, you have endorsed the basic bill which is pending in this committee.

Mr. MACY. Yes, sir. The bill that has been reported out of the House committee, H.R. 11049, and is before this committee today. Senator RANDOLPH. Have you stated your views this morning on the advisability of an increase in salary for Members of the Congress? Mr. MACY. I have indicated that title II of H.R. 11049 which specifies an increase for Members of Congress is appropriate and as set forth in the bill maintains sound interrelationships among the branches of Government.

Senator RANDOLPH. Mr. Chairman, do you feel that the raise should be $10,000 rather than any figures below that amount?

Mr. MACY. Yes; I testified earlier that my position was that a higher figure such as $10,000 would be more appropriate and entirely warranted in view of the information we have concerning the comparable salaries outside of Government.

Senator RANDOLPH. One further question, Mr. Chairman.

If in the judgment of the House and Senate no appreciable raise let's say a $2,500 raise were the figure would be included in the bill, you would think of the overall purpose of the increase for Federal employees. You would ask the President presumably to sign such a bill, is that true?

Mr. MACY. Let me make certain that I understand your question fully. This is in the event that the Congress were to enact a bill that would call for an increase of $2,500 in congressional pay and in executive pay, what would my recommendation be to the Congress.

I fear that that is an "iffy" question which I hope will never have to be answered. However, I would feel that some increase would certainly be better than none. But I feel as small an increase as that would not go sufficiently far to rectify the inequities that exist at the present time or to meet the needs of the Federal service.

Titles II, III, and IV of that bill provide sound interrelationships of the top salary structure in the three branches of our Government. We believe, however, that there should be further consideration of alternatives which would raise the top executive pay level above the figure of $32,500 proposed in H.R. 11049.

In closing, I emphasize again the President's request and the pressing need for enactment of a pay bill at this session of Congress which will maintain the statutory comparability principle for career schedules and will make suitable adjustments in the pay of upper level Federal positions which bear much of the responsibility for the country's welfare.

The proposals on statutory schedules incorporated in H.R. 11049— Are called for by existing statutory requirements; and Should be enacted in fairness to Federal employees and in the interest of competent staffing.

Adjustment of top Federal salaries is essential

To provide more equitable compensation for the Government's principal officers; and

To permit the statutory principle of comparability between Federal and private enterprise pay to operate effectively for career systems.

I want to thank you, Mr. Chairman, for this opportunity to appear again, and to commend you and your associates for calling this hearing at this time to permit more expedited action in considering pay legislation.

I am available for any questions you may wish to ask me.

The CHAIRMAN. Chairman Macy, does this bill, H.R. 11049, correct the inequities that now exist in the various upper grades?

Mr. MACY. Yes. The bill proposed by the House, H.R. 11049, would provide new scales for the top of the Classification Act which would overcome the inequities which I described in my testimony.

The CHAIRMAN. The administration does not object to increases in the lower grades, does it?

Mr. MACY. No, the administration is accepting the increase in the rates at the lower grades as reflecting an adjustment to coincide more nearly with the increases in private enterprise rates that have occurred since the enactment of the original statute in 1962.

The objective of the administration is to bring all levels of the career statutory schedules in line with comparability as rapidly as that is possible. The economic pressure on those in the lower levels is greater and the administration supports the view of the House in increasing the rates more rapidly at those points.

The CHAIRMAN. When we passed the last pay bill, there was nothing in it concerning executive pay, is that not true?

Mr. MACY. That is correct, Mr. Chairman.

The CHAIRMAN. How far back has it been since the executive pay has been adjusted?

Mr. MACY. Executive pay was adjusted by statute in 1956, the year following the most recent adjustment of rates for Members of Con

gress.

The CHAIRMAN. In 1962, when the last pay bill was passed, we anticipated taking up the executive pay bill in 1963 before these inequities

could occur in the upper grades. We did not enact a bill in 1963. Hence, they did occur.

Mr. MACY. Yes, sir. In fact, in your report for this committee in 1962, you placed the request upon the administration to come before the Congress in 1963 with a proposal for executive pay and the top rates in the career systems in order to accomplish what you termed to be "the incomplete aspect of salary reform.”

The CHAIRMAN. Mr. Macy, are there any inequities in the bill now reported out by the House that you would suggest that we take care of in this committee?

Mr. MACY. I mentioned in my testimony the desire on the part of the administration for consideration by this committee of the top level in executive pay in the House bill. That bill, as it has been scheduled for reporting, provides a top level for Cabinet officers at level I in executive pay of $32,500. It is the view of the administration that that represents a minimum increase and that serious consideration should be given to a higher level as more reflective of the views of the Randall Panel and as more nearly meeting the level of pay now prevalent in many State and local jurisdictions and in nonprofit enterprise in the private sector.

The CHAIRMAN. Do you think that if we should increase executive pay to a higher amount then recommended by the House, that it would affect the House in the passage of the bill?

Mr. MACY. That, I believe, is a matter of legislative speculation on which I am not prepared to comment.

The CHAIRMAN. In other words, you would leave that to us?

Mr. MACY. Yes; I think your fingers are more sensitive in feeling that pulse than mine would be.

The CHAIRMAN. I notice that you do not mention a date that this bill would go into effect. Have you any suggestions along that line? Mr. MACY. The view of the administration is that the need for the salary levels proposed is of such urgency that the entire bill should be made effective upon enactment. If it is the judgment of the Congress that certain rates should be deferred until a later date, it would be the view of the administration that as few rates as possible should be deferred to a later date.

The CHAIRMAN. You would not object, then, to the salaries of Members of the House and Senate being deferred?

Mr. MACY. Not if that is the judgment of the House and the Senate. The CHAIRMAN. Again, you are leaving that to the judgment of the House and the Senate?

Mr. MACY. Yes, I believe their judgment would be very sound on that particular point.

The CHAIRMAN. Have you estimated what the cost of this bill will be?

Mr. MACY. Yes, sir. The cost of H.R. 11049, all titles, would be $533 million. This is approximately $11 million less than the amount of money placed in President Johnson's budget for fiscal year 1965 to cover a pay increase. This, therefore, is clearly within the fiscal limitations of his budgetary plans.

The CHAIRMAN. The budgeted amount was based on the assumption that the pay bill's effective date would be July 1, 1964. If some increases became effective at a later date, the total cost would be reduced

by an amount of the fraction of the year the increase was postponed, would it not?

Mr. MACY. That is correct. The House bill calls for an effective date upon enactment of all salaries other than those for Members of Congress for the executive levels and for judicial officers. This cost figure I have cited to you in based upon full-year costs; the assumption with respect to all salaries is that they would exist for the full 12 months of fiscal year 1965. So, any later enactment of these titles would decrease the amount but by a very marginal amount, Mr. Chair

man.

It might be of interest to you and to the members of the committee to have a breakdown of this cost. The cost for the career salaries for the classification act, the post field service, the Veterans' Administration, and the Foreign Service, is $512 million. The total cost in title II for the legislative branch is $9.6 million. Title III, the executive pay title, the total cost is $3 million. And the title IV, the judicial salary title, the total cost is $8.2 million.

Now in titles II and IV it not only includes the principal officers, the Members of Congress, and the judges, but it also includes other personnel in those two branches.

The CHAIRMAN. Senator Monroney?

Senator MONRONEY. Is judicial $8.2 million including the congressional staff?

Mr. MACY. The judicial $8.2 million includes the judicial officers and employees and the judges. The congressional figure of $9.6 million includes $4.1 million for Members and $5.5 million for legislative officers and employees.

Senator MONRONEY. And then the executive pay increase for Cabinet officers, and so forth, that would be non-civil-service.

Mr. MACY. These would be some 380 positions under the Federal executive pay provisions and it would also include in the House bill some officers of the District of Columbia. The purely Federal executive group is $2.8 million and $0.2 million, or $200,000, for the District of Columbia officers.

Senator MONRONEY. Could you give us a breakdown on the numbers affected in the lower grades, perhaps GS-1 through 6, where you leave the lower grade workers and then go into the others? You can submit that for the record.

Mr. MACY. I will be glad to submit it for the record.

Senator MONRONEY. The numbers, the percentage of employees, the combined rate as to total employment in the executive department, the percentage of increase, and the dollar cost. Then from GS-7 up through perhaps GS-14 or GS-15 where you consider the breaking point on the executive. Give us the same thing and percentages of

cost.

Also for the higher grades. The real problem that is pressing us so hard is the fact that our GS-15 rates are out of line with our GS-16, GS-17, and GS-18.

Mr. MACY. I will be happy to do that. In fact, I might supplement that by giving you population by grade levels throughout so that you have that for further reference.

(Subsequently, Mr. Macy submitted the following letter and enclosures:)

U.S. CIVIL SERVICE COMMISSION,
Washington, D.C., May 8, 1964-

Hon. OLIN D. JOHNSTON,

Chairman, Committee on Post Office and Ciril Serrice,
U.S. Senate, Washington, D.C.

DEAR MR. CHAIRMAN: I am sending with this letter the material requested at the May 4 hearing of the Committee on Post Office and Civil Service of the U.S. Senate on the adjustment of Federal salaries.

Enclosure 1 shows Classification Act employment and salary cost of the proposed Classification Act schedule in H.R. 11049, grouped for grades GS-1 through GS-6. GS-7 through GS-15, and GS-16 through GS-18, as mentioned on page 18 of the transcript. Enclosure 2 provides the information by individual grade level mentioned at the bottom of page 18 of the transcript. This enclosure shows average salary increases and increases in salary cost, by grade, of the proposed Classification Act schedule in H.R. 11049.

I wish again to thank you and the members of the committee for the opportunity to support the urgently needed pay adjustments called for under the statutory comparability principle in the Federal Salary Reform Act of 1962. Sincerely yours,

ENCLOSURE 1

JOHN W. MACY, Jr., Chairman.

Classification Act employment and salary cost of proposed Classification Act schedule in H.R. 11049, by groups of grades

Schedule in H.R. 11049 as ordered reported by House Post Office and Civil Service Committee; employment based on preliminary figures for June 30, 1963)

Average salary increases and increases in salary cost, by grade, of proposed Classification Act schedule in H.R. 11049, as ordered reported by House Post Office and Civil Service Committee

[Based on preliminary figures for employment on June 30, 1963)

NOTE 1.-Azgregate cost, including Government's expenditure for retirement and insurance, $337.234.645. NOTE 2-Aggregate cost would be reduced by an amount estimated at approximately $20,000,000 by change in pay computation method, thus leaving an aggregate net cost of about $317,000,000.