A state Senate panel recently had a meeting in an attempt to shore up the state’s pension system.
A change to the system is overdue.
The Associated Press reported officials from groups representing teachers and firefighters told members of the Senate Pension Committee they oppose legislative efforts to end the traditional pension program for new hires and consolidate the administrations of the state’s several pension systems.
Although details haven’t emerged, many Republican legislative leaders support an end to the traditional pension system for some newly hired state workers who would move to some kind of alternative 401k-style, or defined contribution, retirement account more common in private industry. They argue such a move would help shore up the roughly $11.6 billion in unfunded liability of the state’s seven pension systems, most notably a roughly $8.4 billion unfunded liability of the Oklahoma Teachers Retirement System.
Pensions were a way to “reward” those who chose a public service career to offset the low salaries when compared to the private sector. A comfortable retirement could be had, in essence, by sacrificing salary in the career.
But there has been a shift to increase these salaries in the last two decades, and rightfully so. These are vital jobs that need to be filled, and, like it or not, an attractive salary makes it easier to fill these needed jobs.
And while the salaries are not as high when compared to the states who share our borders, they are nowhere near lagging behind the private sector as they once were. And the pensions haven’t dropped in response.
This plan seems like a sensible approach, affecting only new hires while guaranteeing pensions for those who have earned them.
We understand why most working in these fields oppose the change. But it is needed.
The unfunded liability is too big a number to ignore.