December 22, 2015

State representatives planning to vote on bad pension legislation

Update: On Dec. 19, state representatives debated Senate Bill 1071, the pension bill that would have made Pennsylvania’s educator retirement system the third worst in the nation, and defeated it by a vote of 52-149.

No cost savings
Changes to the benefits of future employees will cost taxpayers at least 25 percent more than the current pension plans, according to an analysis by the Public Employee Retirement Commission (PERC) released on Dec. 17. The only savings in Senate Bill 1071 come from unconstitutional changes to the retirement benefits of current employees that PSEA vows to challenge and the courts are likely to throw out. If that happens, Senate Bill 1071 will actually cost taxpayers $2 billion more, PERC estimates.

"This bill doesn't save money and likely violates the state constitution. PERC's analysis is just the latest in a long list of reasons why this bill is bad for taxpayers and working people in Pennsylvania," said PSEA President Jerry Oleksiak. "This is a needlessly self-destructive approach to a problem, like the old adage of cutting off your nose to spite your face. It would cost the taxpayers more in order to provide less to working people."

What's in the bill?
Senate Bill 1071 does nothing to address the state's pension debt. It will:

  • Make unconstitutional changes to the benefits of current educators, nurses, and state workers.
  • Reduce current employees' monthly pension checks by changing the rules for withdrawing member contributions if they choose a lump-sum withdrawal.
  • Cut benefits for younger educators, nurses, and state workers by 18 to 28 percent.
  • Weaken PSERS and SERS.

Learn more about the legislation at

How is it different than the bill the Senate passed on Dec. 7? 
Unlike Senate Bill 1082, this House bill gives lawmakers and any other current employees in SERS and PSERS the choice to opt in to the new plan, which would cut their retirement benefits by 18 to 28 percent. That means some of the same lawmakers who are insisting on pension "reform" get to stay in the current plan unless they choose to go into the new one.

This new bill also cuts out language in Senate Bill 1082 which would have put more of the state's pension payments on a credit card and allowed the General Assembly to vote on it without the independent actuarial analysis required by law.

Both Senate Bill 1082 and Senate Bill 1071 cost more to provide less in retirement benefits. 







Member Advocacy Center

Featured Video