ALEXANDRIA, Va. (7/26/13)--The National Credit Union Administration Thursday approved changes to its 2013 operating budget, reducing that budget by $2.6 million.
The $2.6 million savings will help offset costs of the 2014 budget, the NCUA said.
The budget decrease brings the total 2013 budget to $248,811,780. This is the fourth mid-year budget decrease the agency has approved.
The agency is also holding employee base salaries at their current levels, in voluntary compliance with the federal pay freeze. The agency had planned $9.1 million in 2013 salary and benefits.
The decrease to the operating budget is primarily due to a $6.3 million net decrease in pay and benefits, but the NCUA board did agree to a $3.6 million one-time lump sum payment to eligible employees.
The one-time payment will average 3% of eligible employee's salaries.
NCUA said this action was necessary because under the Federal Credit Union Act, the agency's pay scale must be comparable to that of other federal financial regulators. NCUA salaries have not kept pace with those of other regulators, the board noted.
The Credit Union National Association has encouraged the agency to hold itself to the same standards of containing costs that credit unions are held to by their examiners--including on conditional pay increases for employees.
"While credit unions are performing well financially, they are still working hard to contain costs, and many are being instructed by examiners to do even more to watch their expenses, including salary increases. Credit unions believe NCUA should be held at least to similar standards," CUNA President/CEO Bill Cheney said.
In adopting its 2013 budget last fall, the agency noted the U.S. Congress had not yet approved a federal employee pay increase, and indicated that NCUA would not expend $9.1 million it had set aside for a conditional pay increase. Congress has still not approved a federal budget, and CUNA has urged NCUA to continue holding off this expenditure until that approval occurs.
CUNA has also suggested that NCUA:
- Consider providing even more information about its budget, such as detailing cost increases per employee for the fiscal year; and
- Contain costs related its proposal on derivatives, which includes additional costs to credit unions of implementing the program of between $6 million and $11 million.