AP: States cutting benefits for public-sector retirees

[Omaha Steve]

Rush was hitting on this again yesterday.

http://www.omaha.com/article/20100916/AP05/309159967

Published Thursday September 16, 2010

By GEOFF MULVIHILL and SUSAN HAIGH

TRENTON, N.J. (AP) - William Liberty began as a trash collector in Lindenwold 37 years ago and worked his way up to public works supervisor. Until recently, he figured he would hold on to the job until he turned 65.

But last week, at 62, he was preparing his retirement papers, joining a rush among New Jersey public employees.

Liberty's reason for getting out now: He is feeling the sting of a campaign by Republican Gov. Chris Christie and a growing number of other public officials across the U.S. to balance their budgets by making government employment - and retirement - less lucrative.

Liberty's pay has been frozen for two years, he has been told to take unpaid furloughs, and now, "it's going to get worse." Pension proposals announced this week could reduce how much he receives when he retires.

Since 2008, New Jersey and at least 19 other states from Wyoming to Rhode Island have rolled back pension benefits or seriously considered doing do - and not just for new hires, but for current employees and people already retired.

It's not just a U.S. phenomenon. In France on Wednesday, lawmakers voted to raise the retirement age from 60 to 62. If the measure wins final approval, France will become the latest European Union country to require workers to stay on the job longer because of a deficit-plagued pension system.

FULL story at link.

[Divernan]

1. I was surprised to read how many states give COLAs to pensioners

On reading the entire article, I learned that many states gave automatic, yearly cost of living adjustments to their retired employees - and now are considering eliminating them. I've been a retired PA state employee for 7 years and never gotten a COLA. Given the dire straits of our state budget, I have zero expectations of seeing a COLA in my lifetime.

Pennsylvania, a "blue state" is dead last in taking care of its pensioners.

According to this link:
http://www.psea.org/general.aspx?ID=2354

"Other states have prioritized a COLA

Among the fifty states, 80 percent grant yearly COLAs. There are ten states that do not offer annual COLAs. Nine of these ten states enact a COLA every other year. Pennsylvania is finishing dead last in assisting its state retirees in comparison to other states that have made it a priority."

Pennsylvania retirees need a COLA

* There are approximately 162,000 retirees in the PSERS system and approximately 60,000 individuals receive less than $1,000 a month and pay over $300 a month for heath insurance.
* Retirees who retired before the increase in the multiplier are in serious financial need of a COLA.
* The average retiree will live 25 to 35 years following retirement and inflation can double or triple the dollars needed to maintain their living conditions.
* The average pension benefit for former male state employees is $600 a month more than for female retirees.

The economy has changed since PA's last COLA in 2002.

* The Consumer Price Index has risen by almost 14 percent since the last COLA in 2002.

* Since the last Cola, health care costs have dramatically risen. Retirees have waited since 2002 for a COLA while shouldering a greater percentage of out-of-pocket medical costs.

[Omaha Steve]

2. City of Omaha has no COLA for civilians either

I don't know what the sworn employees (police & fire) get for a COLA. I'll retire in 10-15 years and I know we won't get a COLA included in our mix before I go.