Jun. 30, 2015

Measure also removes lawmakers from current state pension system

HARRISBURG – State Rep. David Maloney (R-Berks) today voted in favor of Senate Bill 1, which would shift state and public school employees hired after Jan. 1, 2016, from a defined benefit plan to a hybrid 401(k)-style and cash balance plan for current and future employees, was passed today by the House on a predominantly party-line vote.

“This legislation forces members of the state House and Senate to lead by example as it will require legislators to be moved to the hybrid 401(k)-style plan if they run for office again and are successful,” Maloney said. “They will be treated as ‘new employees’ and moved to the same retirement system as future state and public school employees. New legislators would also be placed in the new system.”

Senate Bill 1 will not impact current retirees. It will also not flip any current employees into the new retirement system. While there will be minimal changes to their benefit, these changes are being made purely for the solvency of the entire system.

Senate Bill 1 also removes the state Legislature from having any role in administering the system and places that responsibility solely in the hands of the individual retiree.

“That is as it should be, Maloney said. “It is their money, and participants in a 401(k) have the final say in how their money is invested.”

Representative David Maloney
130th District
Pennsylvania House of Representatives
Media Contact: Charles Lardner