Public employee pension reform on the move
The Pennsylvania Senate is scheduled to consider a public employee pension reform proposal nearly identical to the bill that fell just three votes short in the House last fall.
The proposal will contain a 401(k)-component paired with a smaller defined benefit component for new employees.
New employees can also choose a single 401(k)-style plan, which will provide portability and retirement control.
These includes those in the State Employees Retirement System (SERS) and the Public School Employees Retirement System (PSERS).
Additionally, the proposal lets current employees opt-in to the hybrid plan or 401(k)-only plan — something many say is a welcome improvement over last year’s proposal.
Meanwhile in the state House, Rep. Warren Kampf has introduced pension reform identical to last October’s plan.
Both the House and Senate proposals meet three goals:
r Shift future financial risk away from taxpayers.
r Enhance choice and portability for new state and public school employees.
r Slow the accumulation of taxpayer-backed pension debt.
Exempt are state police offices, corrections officers and certain other law enforcement officers.
There are many, many hard-working public employees who have had tremendously productive careers as public servants.
But the same goes for people in the private sector who must rely on their own retirement savings — and discipline to save — hoping their employer offers a match.
That’s the general reality in the private sector.
Yet the pensions for public employees versus their private sector counterparts are worlds apart.
Municipalities, the state and public school districts are weighed down by billions of dollars in collective pension obligations.
Tax rates are high because of pension obligations and after-retirement benefits whose costs are picked up by taxpayers.
Cities are going broke over pension costs.
It’s time for serious, meaningful reform moving forward.