Government
2:45 pm
Thu June 14, 2012

State House Proposal To Reform Pensions For Some State Employees

House Republicans have unveiled their own proposals to change state worker pension in Pennsylvania just weeks after their counterparts in the Senate introduced a pension reform plan.

Top Senate Republicans were quick to acknowledge their proposal to enroll future state and school district employees in a 401-k-style retirement plan wouldn't address the huge burden of current employees. So the state would still be on the hook for billions of dollars to pay for their defined-benefit plans.

But Representative Warren Kampf (R-Chester) said under his proposals, current employees would be encouraged to switch to the new defined-contribution plans.

"And receive not 4% from the employer, but 7% from the employer," Kampf said, "and they the employee would be required to contribute 4%."

However, under the measure, new hires would only receive a 4% contribution from their state and school district employers. The legislation does not apply to new state police hires.

Representative Stephen Bloom (R-Cumberland) said he supports the measure.

"This is a big deal. It fits into the big context of getting Pennsylvania right on, back on the right track fiscally and making us a solvent state that can go into the future without an excessive burden on the taxpayers," Bloom said.

The state's pension funds face a deficit of about $40 billion. Governor Corbett has singled out pension reform as a top priority of his administration once the budget's finished.