Still doing his bit for the plutocracy!
HARRISBURG, Pa.—State and school employees would be forced to forgo nearly $12 billion worth in pension benefits over the next 30 years if Gov. Tom Corbett’s pension reform plan is approved, according to an administration analysis released Tuesday.
The itemized summary marked the first time the administration has publicly disclosed estimates of the savings and costs associated with the multifaceted pension reform plan Corbett unveiled in his budget address this month.
The Republican governor’s proposal to reduce future benefits for current employees is the centerpiece of his pension-reform initiative. But it faces an uphill fight in the Legislature and possibly the courts.
“We will maintain that doing so would be unconstitutional,” Wythe Keever of the Pennsylvania State Education Association, the state’s largest teachers’ union, said Tuesday.
Corbett’s plan to divert newly hired employees into a 401(k)-style plan would save taxpayers more than $2.5 billion through 2043, compared to the cost of enrolling them in the present, defined-benefit pension plan, according to the summary.
But those savings would be more than offset by proposed limits on the growth of taxpayers’ share of pension costs in the next few years, which would push more than $3 billion in new costs into later years.
Earlier Tuesday, Democratic state Treasurer Rob McCord and a labor-affiliated research group attacked the proposal 401(k)-style retirement plans.
McCord and economist Stephen Herzenberg of the Keystone Research Center said in a teleconference with reporters that the plan wouldn’t save taxpayers money but instead would cost more.