February 10, 2015
By Tim Reid
Public worker unions and others who back traditional pensions over 401(k)-style plans got ammunition on Tuesday from a new study that shows U.S. state governments that made the switch did not achieve the predicted savings but rather lost money.
The National Institute on Retirement Security (NERS), a non-profit group that has defended traditional public pensions, issued case studies on three states that switched to 401(k)-style defined contribution retirement plans.
In all three states, Alaska, West Virginia and Michigan, problematic funding gaps widened, the report said. When the changes were made, backers of the switch predicted it would solve funding problems.
Read the full story from Reuters here.