Government Ignores Law Limiting Executive Salaries of Contractors

Sunday, September 18, 2011
United States law demands that the government limit the amount of executive salaries earned by companies with federal contracts. But the Office of Management and Budget’s Office of Federal Procurement Policy has not set the limit for fiscal year 2011, and the amount that government contractors’ top executives are making has more than doubled since the 1990s. That’s not sitting well with some lawmakers.
In a letter to the Office of Management and Budget, Senators Barbara Boxer (D-California) and Chuck Grassley (R-Iowa), along with Representative Paul Tonko (D-New York), urged the White House office to set a ceiling on “the maximum salaries top contractor employees can receive by the end of fiscal 2011.”
“At a time when millions of Americans are unemployed, and millions more are taking home paychecks that don’t go as far as they used to, we ask you to determine the executive compensation benchmark for 2011,” wrote the lawmakers. “The American people deserve to know exactly how much government contractor executives will charge the taxpayer for their salaries this year.”
In 1998, the limit for the salaries of the top five employees of a government contractor was $340,650. By last year these same employees were earning $693,951—a rate that’s grown 53% faster than the rate of inflation.
-Noel Brinkerhoff
Legislators Urge OMB to Set Cap on Top Contractor Executives' Salaries (by Dan Liebelson, Project on Government Oversight)


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