Jun. 14, 2016
HARRISBURG – Speaker of the House Mike Turzai (R-Allegheny) and House Majority Leader Dave Reed (R-Indiana) today applauded the strong bipartisan passage of a critical public employee pension reform bill and called on the Senate to pass and Gov. Tom Wolf to sign
Senate Bill 1071.
The bill passed by a vote of 136-59.
“This is a significant first step in the right direction to start tackling Pennsylvania’s unsustainable public pension system,” said Turzai. “A defined contribution plan for future hires, which is what the private sector has offered since the mid-1990s, protects the benefits earned by current employees and retirees and fully meets our statutory payment obligations to the retirement systems.”
As it was amended by the House, Senate Bill 1071 is expected to save taxpayers at least $5 billion. It includes significant reform which combines the best attributes of the 401(k) and Defined Benefits (DB) plans.
“Pension reform not only protects our taxpayers, but also enables the commitment to our retirees and current employees to be kept as promised,” Reed said. “With pension obligations being the No. 1 cost-driver for school districts and the state, pension reform is an absolute necessity to avoid property tax increases as well as cuts to core government services.”
Currently, more than 236,000 people are enrolled in the Pennsylvania State Employees' Retirement System (SERS), while more than 609,000 belong to the Public School Employees' Retirement System (PSERS). The systems’ consulting actuaries have reported the systems now face more than $63 billion in unfunded liability.
The plan delivers competitive benefits to new hires in today’s marketplace and helps ensure that unfunded liabilities do not grow further and proactively safeguards the Commonwealth’s credit rating.
“Estimated taxpayer savings are in the billions of dollars with savings realized to be used to pay down the unfunded liability, reducing debt and saving tomorrow’s taxpayers from billions more in interest payments,” said Turzai.
Speaker of the House Mike Turzai
28th District
Majority Leader Dave Reed
62nd District
Pennsylvania House of Representatives
www.PAHouseGOP.com