Thumbs up: Gaps in pension programs require taking steps now
It is one thing to promise retirement benefits. It is another to come up with a way to pay for them.
That is the hard lesson state and local governments across the country have learned over the past few years, especially in the wake of the Great Recession.
So, it is good that a joint state House-Senate committee is taking a look at pension requirements and coming up with some proposals. The state faces an estimated $5.6 billion gap between on-hand assets and benefits promised by five state retirement programs.
Most would agree the state should not radically change pension plans for those nearing retirement. Many in the private sector have seen pension promises altered late in the game, and that can create real hardships.
But it makes sense to look at the promises being made to future employees. Among the proposals are:
Later retirement ages, moving from age 60 to 62.
Requiring employees to contribute more, increasing the rate from 4.5 percent of their pay to 6 percent.
Basing benefits on the salaries for the last five years of work, rather the last three.
Each of the retirement programs is a little different, so the changes would not affect teachers, troopers and other types of state workers in the same way. But it is good to see the legislature looking at this long-range challenge.
Ohio recently adjusted the requirements for its pension programs for the same reasons, and the changes were even more dramatic. But it was necessary to keep the programs viable and the costs reasonable for taxpayers.
Lawmakers cannot expect the public to pay more and more to give government workers better benefits than those in the private sector receive.
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