2013 Executive Budget
Proposal
CSEA Memorandum on PENSIONS
In 2009
public employee pension benefits were reduced by the creation of Tier 5. At that time the public was told taxpayers
would save over $35 billion. In 2011,
public employee benefits were again reduced and taxpayers were again told they
would save over $80 billion. CSEA
vigorously opposed the creation of Tier 6 citing the lack of need as it would
further punish public employees and would not result in any immediate
savings.
New York
State has been providing stable reliable pensions for millions of employees at
all levels of government. Over those
years, both elected leaders and CSEA protected the pension fund from raids and
ill-advised schemes that would threaten the integrity of the fund and its
ability to provide benefits. This
diligence has protected New Yorkers and resulted in having the nation’s best
funded pension system.
Comptroller
Tom DiNapoli has continually stated that New York’s system is strong,
sustainable and remains a rock–solid source of security to one million working
and retired members. The Pew Center issued a report two years in a row calling
New York one of the best managed pension funds in the country and Governing
magazine cited New York as the national pension leader.
Instead of
addressing the fact that the 2% tax cap mandated on local governments and
school districts was a flawed policy that only yielded political points via the
headlines, the executive budget proposes a plan that would allow municipalities
and school districts to pay a lower “fixed” rate for pension obligations. This is nothing more than an old school bait
and switch. Allowing this type of scheme
would jeopardize the integrity of the most secure pension fund in the nation
and result in a severe underfunding of pension obligations as happened in Rhode
Island, New Jersey, and other states.
Just as Wall
Street greed and fraud caused the collapse of the stock market and need for
higher employer contributions we can’t allow that same greed to enter the
political debate and open the door to a raid on the pension fund.
As our economy
recovers, employer contributions will normalize and we will see lower
contribution rates. Helping
municipalities and school districts reduce costs should not come from dedicated
pension funds.
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