Thursday, February 24, 2011

OCPA Calls For 'Major' Pension Reform

The Oklahoma Council of Public Affairs (OCPA) released the following statement today regarding the passage of House Bill 2132 by House Speaker Kris Steele, which would require cost-of-living adjustments for retired state employees to be fully funded before being implemented.

Jonathan Small:
'Back to reality'
“Now is the time for major reform to Oklahoma’s state pensions,” said Jonathan Small, CPA, OCPA fiscal policy director. “Each of Oklahoma’s six major pension funds has experienced a significant decline in its funded ratio over the last decade. During the last fiscal year alone, the state pumped in more than $1 billion dollars to existing state pension systems, yet the systems had a combined unfunded liability of more than $16 billion. It’s clear the problem with our pensions is not a lack of funding but rather a combination of several factors, including irresponsible legislative action, employee union lobbying, lack of transparency in reporting the conditions of the systems to the public, and overextension of benefits to beneficiaries.”

“Lawmakers, agency directors, employees, and beneficiaries alike need to understand that retirement is primarily the responsibility of the retiree -- not the employer, the government or society at large,” Small added. “Reforms must be enacted now to bring state spending on pensions back to reality, and the measures heard today in the House do just that.”

Small also praised House Speaker Kris Steele and Rep. Randy McDaniel for their commitment to enacting real pension reform.

“We applaud Speaker Steele and Representative McDaniel for their leadership in standing for fiscal responsibility rather than watching our state become engulfed in the fiscal chaos that plagues Wisconsin, Illinois and California,” said Small. “The signs are everywhere that this has become a crisis situation. And now that Moody’s Investors Service has announced that our pension liability could affect the state’s credit rating, we simply cannot afford to kick the can down the road again.”

“At the crux of this debate,” Small said, “unions are advocating that a citizen’s purpose in life is to provide public employees and government bureaucrats with a grander retirement than the taxpayer will earn for their family. It is the wrong side of history to be standing on − both philosophically and morally.”

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