Steinhauer on pensions: Costs not “exploding”

Employees already doing their part, state must too

Published on Tuesday, February 25, 2014

According to published reports, Gov. Christie will use today’s budget address to decry “exploding” pension costs and make the case for “additional reforms” beyond the drastic changes made in 2011 which, according to the Governor, will save state and local governments $122 billion by 2041.

NJEA president Wendell Steinhauer issued the following statement in response to those press reports:

“If published reports are true, Governor Christie is doing the right thing by making the full, legally required pension payment this year.  But he is doing the wrong thing by misleading New Jersey residents about the state of the pension system.

“Pension costs are not ‘exploding.’  As a result of deep, painful cuts absorbed by public employees and retirees in 2011, pension costs going forward have been curtailed, and the state is finally on the road to responsible, sustainable pension funding practices.  It’s not easy, but it’s necessary and it’s legally required.

“While the consequences of the 2011 law were severe, immediate, and continue to grow for public employees, the state was allowed to phase in its required contributions very slowly over 7 years.  Those contributions are not ‘exploding.’  They are growing at precisely the rate that actuaries said they would when the law was signed.  Governor Christie knew then, and he knows now, that the state is paying largely for its past failures to fund the pension promises it made. 

“Public employees are already paying dearly for that failure.  Since 2011, they have been paying significantly more to receive significantly less in order to save the state and local governments $122 billion.  That represents a tremendous sacrifice by public employees, retirees and their families. The state must continue to share the burden and share the pain of returning to fiscal responsibility.”

Steinhauer will issue a detailed statement regarding the entire budget address at its conclusion.

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