12/9/09: Chapter 293 is pleased to inform you that House and Senate conferees have produced a FY 2010 omnibus appropriations measure that provides for an SEC budget with an additional $85 million beyond the agency's original request (which itself was a boost from the previous year's budget). This budget is more than sufficient to fund the SEC's needs in the coming year -- including the vital immediate goal of rectifying the recent reductions in the SEC's investments in its human capital.

Earlier this year, the SEC submitted a FY 2010 budget to Congress that once again contained a reduced amount for merit pay. Once again, NTEU's Legislative Department and Chapter 293 leadership worked successfully with key members of Congress to increase that budget. Over the summer, the House approved a $10 million increase over the agency’s budget, which was included by the Appropriations Committee at NTEU’s urging. Shortly thereafter, the Senate Appropriations Committee approved an increase of approximately $100 million over the agency’s request. The conference committee has now produced a budget for the agency that is $85 million over the original agency request.

The Union's ongoing communications with key appropriators have made it clear that the SEC will be able to utilize this very substantial infusion of additional funds over what it requested to meet several important goals simultaneously. Those goals include hiring approximately 475 new employees, returning the SEC's merit pay budget to a 3% annual increase, reinstating full funding for the Student Loan Repayment Program, fulfilling the SEC's 2006 promise to increase its employer match to SEC retirement accounts, and making technology upgrades. "NTEU is very pleased that the conference report includes an additional $85 million in funding for the SEC above the President's request," NTEU National President Colleen Kelley remarked earlier today. "This is sufficient funding to both hire much needed additional staff for the SEC and fund the negotiated merit pay system at the SEC as well as improve employee benefits and training."

Unfortunately, however, to date, the SEC has failed to communicate to the Union any plan to increase its merit pay budget for the end of next year. Furthermore, SEC leadership has failed to commit even to providing support for the fundamental goal of addressing the recent inadequacies of the agency's budgets for employee compensation and benefits.

Under Chairman Cox, the SEC repeatedly slashed its merit pay budget, sending the clear message that senior management did not believe that human capital issues are a priority at the agency. This policy was but one part of a broader set of policies that included quietly reducing the agency's staff through attrition and weakening the agency's role as a financial sector regulator. We all know that these shortsighted policies severely damaged employee morale, as well as the agency’s ability to retain its best employees -- as the recent Federal Human Capital Survey results so eloquently demonstrated.

Under current leadership, the SEC has made some important and decisive shifts in new directions. Unfortunately, however, we have yet to see a similar break from the previous administration's failed human capital policies, despite the clear support for such a shift on Capitol Hill. Indeed, this year, as in last, the SEC maintained its Merit Pay budget at a level far below the historic norm for the agency. Furthermore, for the first time, the SEC failed to fully fund the Union-negotiated, highly popular and successful student loan repayment retention program. And the agency still has not followed through on its promise during the 2006 compensation negotiations to increase its employer match in employee retirement accounts, to bring the SEC more in line with similar benefits provided by other financial regulators, such as the FDIC.

It would be folly for the SEC to continue to perpetuate these human capital policies, even as it seeks to attract hundreds of the best and the brightest from the private sector to commit themselves to careers in public service at the SEC. To build and maintain a stronger and more robust SEC, it will be necessary to ensure that employees are adequately compensated.

The Union will continue to work for fundamental change on these compensation issues.