Frey urges General Assembly to pass pension reform bills to alleviate state budget woes

State Representative John Frey (R-111) urged the legislature to address Connecticut’s unfunded pension liabilities in his testimony in front of the General Assembly’s Appropriations Committee Friday.  As a solution to this problem that has hamstrung the state economy, Rep. Frey submitted bills to rein in state employee health care and pension costs and eliminate public pensions for elected officials.

In his testimony, Rep. Frey spoke in support of HB 5829, to increase certain co-pays paid by state employees for health care services, HB 6085, to require the legislature to vote on all collective bargaining agreements, HB 6087, to ensure all state employee pension calculations are based on income only, and HB 6292, which prohibits future elected officials in Connecticut from receiving a state pension.

Rep. Frey told the committee that he believes passage of these bills would be a step in the right direction of implementing long-term structural changes to solve ongoing problems in the state budget that will help lower the tax burden on Connecticut residents and businesses.

“Connecticut’s pension and retirement health care programs for public-sector workers are among the worst-funded of any state’s, and this situation is due, in large part, because lawmakers have protected themselves from having to analyze and vote on labor agreements,” said Rep. Frey said in support of HB 6085.  “Contract approval-by-default is unfair and allows the legislature to endorse pay hikes for unionized workers and other labor deals without having to vote for them.”

Most state employees currently contribute 2% to the pension program while some give nothing. The national average contribution for state employees is nearly 7%.

“Structural changes such as removing overtime earnings from pension calculations, and requiring all workers to contribute 4% of their pay toward this benefit would improve the sustainability of our pension system,” said Rep. Frey. “Under the current practices these proposed solutions are not even allowed to be considered.”

Rep. Frey emphasized the strain that unfunded pension liabilities have placed on the state budget, a figure that totals more than three times the state budget.  He asked his fellow lawmakers to consider that state employees’ pensions should look more like private sector workers’ and part-time elected politicians do not need to receive taxpayer-funded pensions.

“Right now, state government is seriously considering measures such as drastic cuts to education, raising taxes on hospitals, and taking away tax credits for middle income homeowners. We are all going to be hurt by the budget in its current form. It is time to change our mentality and look at all of the savings that can come from reducing our bureaucracy. Adjusting how pensions are calculated and taking away public pensions for elected officials will help cut unnecessary spending without adding an extra tax on our residents. As lawmakers we need to take a hard look at our current budget and accept that this is where the most savings can come from,” Rep. Frey added.