Welcome to the latest edition of This Week in Pensions! As we do most weeks, we have gathered the best stories about pensions and retirement security from the previous week. This is the news you need to know in the fight for a secure retirement.
Here are this week’s top stories:
Public sector employees contribute to the state’s economy. They shouldn’t be vilified by Alisha Blake. In the Hartford Courant, Alisha Blake, the campaign coordinator for the Connecticut Coalition for Retirement Security, writes about how public pensioners make an economic impact in their communities. Blake writes, “State and local pensions are a great investment for Connecticut taxpayers. According to the National Institute on Retirement Security, in 2016 alone pensions generated $7.1 billion in economic activity. Each dollar invested by taxpayers into public pensions supports $3.54 in economic activity, while each dollar paid out in pension benefits creates $1.42 in total economic output here in our state.”
‘We were promised a pension.’ Thousands of KY public workers face uncertain futures by John Cheves. In a piece for the Lexington Herald Leader, journalist John Cheves discusses the human impact of HB1. Quoting several current quasi-government employees, he describes how pensions are a vital tool for recruitment and retention. Speaking of pay and his benefits, Garrard County Health Department inspector J Smith said, “We all understood the pay would be low, but you don’t take a state job for the pay. The good pay is in the private sector. What we were promised was a secure retirement we didn’t have to worry about. We could always count on that.”
Kentucky greenlights pension bill that will increase the state’s liabilities by Shelly Sigo. Last week, Kentucky Governor Matt Bevin signed his pension bill, HB1. One of the prime tenets of the legislation is incentivizing quasi-state agencies and regional universities to leave the Kentucky Retirement Systems (KRS), so they can receive relief from increasing pension contributions. Although the freeze is much needed and will relieve the already stressed budgets of these agencies and regional universities, the bill will increase the unfunded liability of the plan. In the Bond Buyer article, Sigo quotes Tom Kozlik of Hilltop Securities, who says that Bevin’s HB1 “stand(s) to increase the amount of liabilities” in KRS. The Kentucky Public Pension Coalition has been making this argument since the very beginning – warning lawmakers that they are only going to make the situation worse.
Be sure to check back next week for the latest news in the fight for a secure retirement!