Unfunded pensions for state employees are Connecticut’s most significant economic problem. In fact, we have the most under-funded pension system in the nation—more than $127.7 billion in liabilities, according to the American Legislative Exchange Council.
That equals a staggering $35,721 of debt per person, the second highest per capita debt in the nation. For every $100 the state now spends for current contributions to employee pensions, we pay $400 in pension debt—pension payments we should have made years ago.
The years of underfunding those pension plans are catching up with Connecticut, and neither lawmakers nor taxpayers can hide from the costs any longer. Payments on the enormous debt for these underfunded pension programs benefit the approximately three percent of Connecticut’s population that consists of current state employees and retired state employees, while they absorb budget funds that could otherwise be spent on road maintenance, safer bridges, and better education.
In 2016, after the record-breaking 2015 tax increase, Governor Malloy closed campgrounds, reduced open hours for nature centers and decreased lifeguards at beaches. Currently, rest-stops on highways have locked bathrooms much of the day because Malloy says we have no money to keep them open.
The situation is unsustainable.
As governor, Manley will address this issue head-on.
- We will preserve the pensions of retirees and current state employees and enable them to choose programs with better long-term performance—and a more certain pay-out for them.
- We will provide greater transparency and fairness to taxpayers. Investment targets will be realistic; liabilities fully funded. Taxpayer representatives, as well as union members, will participate in pension negotiations
- We will restructure the system with appropriate controls on costs, as well as more flexibility and earlier vesting for employees. Practices which inflate pensionable salaries will be eliminated; true safety-nets will be preserved, and employees will benefit from portability.
Work with me to create real solutions for Connecticut’s toughest problems and give people a reason to stay.