Many state and local retirement plans are on an unsustainable course, having failed to set aside enough money to fund the promises they have made. To inform state policymaking, Pew provides research on the fiscal challenges state and cities face as a result of their pension and retiree health promises. With the understanding that there is no one-size-fits-all solution, the project also offers technical assistance to states and municipalities as they undertake pension and retiree health care reforms to ensure their public sector retirement systems are affordable and sustainable, provide a secure retirement for workers, and preserve governments' ability to recruit and retain a talented public-sector workforce.
The Bipartisan Effort in 2013 Resulted in Fair and Effective Retirement System for Employees and Taxpayers Alike
Guidance for policymakers to ensure plans are affordable and sustainable
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Almost all of the $20.8 billion that states paid in 2015 for non-pension worker retirement benefits— what are known as other post-employment benefits (OPEB)—went to retiree health care. The aggregate figure represented an increase of $1.2 billion, or 6 percent, over 2014. Read More
Pension reform legislation enacted this year in Pennsylvania with broad bipartisan support is historic in its scope and impact. The new law establishes what is known as a risk-managed hybrid plan for new employees that lowers costs and significantly reduces risk for taxpayers—while preserving a path to retirement security for public workers. At the same time, it maintains and extends the... Read More
State and local pension plans hold over $3.6 trillion in retirement fund investments for participants and their beneficiaries, with returns on these investments accounting for an estimated 60 percent of the money paid out in pension benefits each year. In recent decades, public pension funds, in a bid to boost returns, have shifted funds away from low-risk, fixed-income investments—such as... Read More