Postal Updates

Trump 2021 budget calls for USPS pay cuts, greater use of private sector partners

Feb 12, 2020, 11 AM
The fiscal year 2021 budget calls for cutting pay for postal workers to a level “more closely aligning Postal Service employee wages with those of other federal employees.”

Washington Postal Scene by Bill McAllister

President Donald Trump’s proposed federal budget for fiscal year 2021 did not call for the outright privatization of the United States Postal Service, but its call for “increased use of private sector partners” and cuts in postal pay likely will alarm many employee groups.

The budget, released Feb. 10, calls for abolishing the Postal Service’s mailbox monopoly, changing “delivery processing, mode and frequency,” and implementing higher prices that are “necessary to support its operations.”

Citing the Postal Service’s persistent red ink, the budget says “the agency must be given the ability to address their expenses — including the cost of personnel — and taking appropriate actions to balance service levels with revenues.”

David Partenheimer, spokesman for the Postal Service, said the agency “appreciates that the President’s proposed 2021 budget recognizes the need to enact postal legislative and regulatory reform.”

He also said the USPS looks “forward to continuing to work with the administration and with Congress to enact responsible postal reform legislation.”

The salary cut suggestion is certain to be attacked by postal unions.

Congress has not allowed the USPS to curtail its current six-day mail delivery schedule, despite repeated pleas from postmasters general.

The budget calls for cutting pay for postal workers to a level “more closely aligning Postal Service employee wages with those of other federal employees.”

That proposal could put pressure on the Postal Service’s board of governors, which is in the midst of a search for a new postmaster general, who will have to negotiate any changes in the current agreements with the agency’s unions.

The Trump budget calls for changes in federal retirement programs and would increase payments potential postal retirees must make. 

As for new revenues, the budget would allow private firms access to household mailboxes for fees.

The budget urges the USPS to add more government services at post offices, a step the agency has largely been unable to do.

According to the budget, all of the reforms it outlines “would save taxpayers $91 billion over 10 years.”

Also the budget would re-amortize the missed annual $5 billion payments for postal retiree health programs that the USPS has skipped since 2012.

The USPS would be required to make the payments over a 40-year period under Trump’s budget. A recently passed House bill would erase the missed payments.

Stephen Kearney, executive director of the Alliance of Nonprofit Mailers, noted that the budget “clearly follows” the recommendations of a postal task force Trump created in 2018. 

“A singular focus on much higher postage rates will not truly reform our mail system,” Kearney said.

Rep. Gerald E. Connolly, D-Va., who heads a House subcommittee overseeing the USPS, said: “The Trump Administration’s push to privatize the United States Postal Service is shortsighted and would harm millions of Americans — particularly those in rural and urban areas.”

“USPS has a constitutional mandate to provide reliable mail service and delivery to all areas of the country,” he said.

“Congress remains focused on passing comprehensive postal reform that will allow USPS to stabilize its finances, modernize its business model, and return to solvency — so it may continue to provide affordable and dependable service to the millions of Americans who rely on it every day,” he said.

Michael Plunkett, president of the Association for Postal Commerce, an organization of large-scale mailers, questioned some of the numbers in the Trump budget, saying “the savings numbers are extremely ambitious.”

He also said the White House’s numbers “do not appear to comport” with the Postal Service’s integrated financial plan and appear inconsistent with the Postal Service’s filings with the Postal Regulatory Commission.

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