Corbett: Pa. pension cuts would apply to all
HARRISBURG — Gov. Tom Corbett acknowledged Thursday that his administration is considering reducing future pension benefits for current Pennsylvania state employees and teachers, and said any such cuts should be distributed evenly to include lawmakers and judges.
“When you don’t have the money, you can’t have the pension plans continue to take so much out of the taxpayers’ pocket,” he told reporters, comparing the state’s situation to pension trends in the private sector.
Corbett conceded the state constitution may shield judges from any reduction in pension benefits and said any major reduction in public pension benefits passed by the Legislature would likely end up being decided in a lengthy court battle.
An administration report released Monday warned the growing financial obligations of the state’s two major public-sector pension funds threaten to drive taxes up, drain funding for other state programs and hurt business growth. The report ruled out higher taxes but said prospective cuts for current employees should be considered.
The State Employees’ Retirement System and the Public School Employees’ Retirement System already face an unfunded liability of $41 billion.
Last year, state government paid about $1.1 billion into the funds. The amount of taxpayer money going into the funds is expected to double to $2.2 billion in the year that starts July 1 and to exceed $5 billion by 2019.
