Obama Calls Again for Capping Government Contractor Pay

January 31, 2012

The Obama administration is renewing its push to cap the pay of government contracting executives as the House prepares to vote on a bill that would freeze federal and congressional salaries.

Certain federal government contracts permit government contracting firms to bill federal agencies up to $693,951 annually for incurred costs, including employee salaries, meaning many contractor executives and some highly-skilled contractors earn more than top-earning federal employees and President Obama. Since 1995, Congress has tied the contractor pay cap to compensation levels for the nation's top-earning business executives — a figure that has ballooned in the last two decades.

In December, lawmakers voted to expand the cap at most agencies to cover all government contractors, including highly-skilled engineers and scientists that also earn top pay. 

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