Statement on Signing Executive Orders Prescribing Federal Civilian and Military Pay Increases.

THE Economic Stabilization Act Amendments which I have signed into law today provide in section 3 that adjustments in statutory pay systems for Federal employees shall be effective in January 1972, and that such adjustments shall not be greater than permitted by the guidelines established for the private sector. Accordingly, I have today also signed an Executive order [11637] which provides a 5.5 percent increase in the statutory pay systems covering those employees.

A 1967 law provides that pay of military personnel shall be increased automatically whenever adjustments are made in the rates of pay for Federal civilian employees covered by the basic statutory system. Therefore, I have also signed an Executive order [ 11638] which will grant comparable increases in pay for military personnel. These increases are in addition to the pay increases provided for military personnel when the Selective Service Act was extended last September.

In connection with this action, a question has arisen as to whether Federal civilian employees and military personnel will be entitled to a second pay increase in October 1972, unless I submit to the Congress, as I did last August, an alternative plan postponing or otherwise modifying the raises that would be prescribed by the machinery established by the Pay Comparability Act. Therefore, I believe it is appropriate for me to state my understanding of the law at this time.

The purpose of section 3 of the Stabilization Act Amendments was to provide equal treatment for Federal employees and military personnel as compared with employees in the private sector who are subject to the Phase 2 pay guidelines. The raises I am implementing today do precisely that. Should a second raise be granted next October, Federal employees and military personnel would be receiving preferential treatments raises in excess of the Phase 2 guidelines. That would be plainly inconsistent with the overall intention of the Congress, which is to relate Federal pay to the guidelines of the Pay Board.

Therefore I am authorizing an annual increase consistent with these guidelines, interpreting the law to mean there will be no automatic October adjustment.