Wednesday August 23rd 2017

Public Employee Representatives Speak Out Against Governor’s Plan

Free News Press – Employee unions and pension funds were quick to respond to California Governor Jerry Brown’s 12-point pension plan proposal to raise the retirement age for new hires and require employees to pay a larger portion of their salary to their pensions.

“Some of the governor’s proposals go too far and run the risk of undermining retirement security for thousands of California school employees and their families,” said Allan Clark, President of the California School Employees Association (CSEA).

Anne Stausboll, Chief Executive Officer of the California Public Employees’ Retirement System (CalPERS) said this is not a good time to make these cuts. “In today’s fragile economy, many employers are facing budgetary challenges and have already made changes to their pension systems,” Stausboll said.

CalPERS, which was formed by the state in 1932, manages the retirement for 1.6 million California public employees, retirees and their families. The meltdown in the economy has raised concerns about the nation’s largest public pension fund. One report found that in 2008 the fund lost 31 percent of it’s value.

“We have observed more than 175 cities, counties and local governments negotiate changes to lower near-term and future costs by increasing employee contributions, modifying benefits for new hires, or both,” Stausboll said. “Changes in the State plan that have already occurred will result in significant savings of about $13 billion over the next 30 years”.

Some of the points in the governor’s plan may require a change in the state’s constitution or collective bargaining with the unions, Stausboll said.

Clark downplayed the problem saying “There is no Armageddon looming for our pension fund and no reason to question the long-term sustainability of CalPERS.” He pointed to out-of-state billionaires trying “generate sensational headlines based on faulty assumptions”.

He said that CalPERS is no bankrupting the state.

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