White House Statement on the Furlough Plan for Government Employees.

THE OMNIBUS BILL for amendment to the various laws so as to permit reduction of Government expenses beyond those which can be effected by the Executive and the Appropriations Committees, should ultimately reduce expenditures by upwards of $225 million and possibly $250 million.

The bill represents the drafting of matters discussed by the joint sessions of the administration representatives and the House Economy Committee, not all the provisions being agreed upon by all the conferees, and one of the differences of view referring to the handling of Federal employee questions.

The following description of the effect of the "5-day week staggered furlough plan" in substitution for the "pay-cut plan" is given in reply to a great many telegraphic and other inquiries.

This plan provides for 1 year:

1. Application of 5-day week directly to per diem employees by eliminating the equivalent of Saturday half-day employment; that is, 26 days' furlough in the year without pay. The equivalent is reached with annual employees by one calendar month's furlough without pay, the month not necessarily to be continuous.

2. Furlough to be mandatory and all holidays with pay are eliminated. 3. The following groups are excepted: (a) all civil employees of income of $1,200 per annum and less, (b) the enlisted forces of the military services, (c) special cases in continuous services where suitable substitute cannot be provided and public interest forbids the absence of regular employees, (d) rural mail carriers in respect to whom it is provided that their vehicle allowances are eliminated in lieu of the shortened time, (e) in cases where the plan would reduce employees between $1,200 and $2,500 income below the prevailing income of comparable occupations outside of the Government. An adjustment to reduced compulsory furloughs is provided through appeal to the Classification Board.

The arguments in favor of the plan are:

a. It establishes the principle of the 5-day week in the Government.

b. It maintains present scale of salaries but each person takes holidays at his own expense.

c. It is prorated to all officials, from Cabinet officers down to persons receiving $1,200 per annum, and provides against hardship to those receiving between $1,200 and $2,500.

d. It provides a saving of $80 million to $82 million as against $67 million on the straight pay-cut basis.

e. With the cuts in departmental appropriations now under discussion in Congress, a number, possibly as many as 10,000 out of the million Government employees, would need to be discharged. Under this plan, however, many substitutes will be required in the continuous services which would enable the retention of these otherwise discharged employees, but beyond this it is estimated that from 25,000 to 35,000 further substitutes would be needed, thus contributing to reduce unemployment. Under the pay-cut plan the unemployment situation would not be met.