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Pa. treasurer McCord, Keystone Research Center to talk pension plan

By - Last modified: February 25, 2013 at 3:06 PM

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In the first in a series of pension primers from the Keystone Research Center, state Treasurer Rob McCord and center Executive Director Stephen Herzenberg will discuss the governor's pension reform proposal on Tuesday.

A big piece of Gov. Tom Corbett’s plan calls for a move to defined-contribution plans for new state employees. That would actually increase costs for the state, school districts and, ultimately, taxpayers, according to the liberal-leaning KRC.

The KRC will argue the transition to a 401(k)-style plan will do nothing to address the current pension debt, according to a news release. It will add to the problem over time, the center said.

The current unfunded liability of the two state-administered pension plans is more than $44 billion.

Democrats largely support maintaining the current defined-benefit system, which was modified in 2010 with Act 120.

That reform act helped address an anticipated spike in pension costs by “smoothing” the increases over a long period of time. That law also reduced benefits for new hires.

 

Jason Scott

Jason Scott

Jason Scott covers state government, real estate and construction, media and marketing, and Dauphin County. Have a tip or question for him? Email him at jasons@cpbj.com. Follow him on Twitter, @JScottJournal. Circle Jason Scott on .

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