SAN JOSE, Calif., June 10, 2016 – “This week’s New Jersey Supreme Court Ruling upholding a freeze on cost-of-living adjustments for retired pensioners demonstrates why all public employees should be concerned if their retirement plans are underfunded. Not a unique situation for the Garden State, growing pension costs throughout the country are threatening the solvency of public employee retirement plans, putting at risk the hard-earned savings of many workers.
“All workers deserve safe and secure futures and retirement plans should place employees on a path to a secure retirement. But when pension plans are underfunded and run low on money, retirement benefits become unsustainable and unpredictable, as demonstrated by what is happening in New Jersey. The Retirement Security Initiative believes that state and local governments have an obligation to ensure that their retirement plans are sustainable, fiscally sound and responsibly managed so that all retirees and employees benefits are fair, sustainable and predictable.
“Policymakers can no longer kick the can down the road, allowing pension debt to skyrocket (such as the case with New Jersey’s $59 billion underfunded system). It’s incumbent upon policymakers to make their systems sustainable and ensure that unfunded liabilities are paid down over a reasonable time period. Refusing to reform pensions now will only lead to disaster down the road.”