Recent Press Releases
CRS Chairman Dave Low in the Sacramento Bee: Public employees support pension fix
Sacramento Bee: Another View: Public employees support pension fix
Published: Sunday, Oct. 23, 2011 - 12:00 am | Page 2E
Dave Low, chairman of Californians for Retirement Security, is responding to The Bee's Oct. 19 editorial, "Pension reform needs a green light from Brown." That editorial stated, "If Brown and lawmakers don't enact serious pension reform soon, a disgusted public will impose its own harsh fix."
Next week, Gov. Jerry Brown and the Legislature are slated to begin a timely and deliberate recrafting of California's public pension system aimed at ensuring the system's stability and long-term affordability. Instead of bowing to political pressures from anti-labor groups and blaring headlines about the 2 percent of pension recipients who receive more than $100,000 per year, they intend to take a careful and thorough look at ways to ensure that Californians have the long-term retirement security we all deserve.
I hope they will begin at this starting point: The condition of public pensions in California is not a crisis. Pension costs make up just 3 percent of the state budget – a percentage that has actually fallen $600 million over the past two years.
The reason for this decline? Collective bargaining has increased the share public workers contribute to their pensions and funds have taken tougher lines on pension spiking. Similar changes are being negotiated in more than 200 California cities, counties and local districts, where public employees have agreed to increase pension contributions, reduce formulas and lower costs.
California's public sector unions intend to be strong partners with legislators in recrafting the pension system.
We support tough action to curb pension spiking and to pound down the pensions of the small number of public workers – mostly senior officials – who have outsize retirement benefits.
We support creation of pension reserve accounts for use during bad economic times, and setting of a fair waiting period before retirees could return to state jobs as part timers.
We support increased pension fund investment within the state, as long as it ensures effective returns. And we support voluntary 401(k)-type funds as a valuable supplement to secure defined benefit pensions.
We are adamant, though, that the present system's central pillars must remain:
• Defined benefit pensions must continue to be the core of the system. Anyone with their pension savings locked into insecure 401(k)-type defined contribution plans knows how precarious it is to be at the mercy of increasingly volatile markets.
• Collective bargaining must remain central to the process. Pensions are part and parcel of a larger wage and compensation structure. Public employers and the unions that represent their workers must maintain the authority to negotiate over pensions.
Meanwhile we must look for solutions that restore retirement security to all Californians. Nearly half of California workers will face hardship in retirement, living on incomes that are less than double the federal poverty threshold, according to a report from UC Berkeley's Center for Labor Research and Education.
While we must stabilize public pension systems, we must also ensure that Social Security is stable for the long haul, and that private sector pensions are secure and stable, too. That is what real pension "reform" should bring.
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