SEARCH

Entries in Pensions (4)

Wednesday
Jun062012

As Unions Reel, Pension Reforms Gain Support

Image Source/Getty Images(WASHINGTON) -- The labor movement was dealt a few blows Wednesday night, and not just in the whirlwind recall election in Wisconsin.

In California, voters in San Diego and San Jose decided to change pension rules, approving ballot initiatives that would reduce benefits for public workers. Support for the ballot questions was definitive, despite unions’ opposition, indicating that voters there view pensions as a key contributor to inflated budgets.

In an era of austerity, concerns about pensions are finding a place not just in Republicans’ playbooks. Scott Walker, the Republican governor who survived the Wisconsin recall Tuesday night, has noted that pension reform efforts have taken root in liberal Massachusetts, Rhode Island, New York and California, too. Walker, of course, got into the recall battle by curbing some collective bargaining rights of state workers.

In Massachusetts last year, Gov. Deval Patrick signed a pension bill that raised the minimum retirement age to 60, from 55. His newer effort aims to stop public workers from getting unemployment money while they’re getting pension payments.

In Rhode Island, Gov. Lincoln Chafee, who has already signed a pension reform bill into law, is seeking to let cities cut benefits to retired public workers. He’s drawn opposition from unions that have said they’d fight the proposal in court if necessary, while mayors have said the measure would alleviate budget pressures.

And in New York, Gov. Andrew Cuomo has tried to cut budgets by raising the retirement age for most government workers to 65 from 62, and lower the amount of money given to workers after retirement to 50 percent of their salary, from 60 percent.

Christina Tobin, the vice president of Taxpayers United of America, a group that pushes for pension reform across the country, said she has seen support for pension reform from a range of voters that includes members of the Tea Party and factions of the Occupy Wall Street movement.

“Pensions are the number-one budgetary problem in the United States,” Tobin said. “The system is unsustainable. If we don’t reform it, the system will collapse and the paychecks will stop coming.”

Advocates for changing pension rules across the country see signs that their movement is getting attention. Jon Coupal, the president of a taxpayers association, told The New York Times after Tuesday night’s votes in San Diego and in San Jose that “the appetite for pension reform in California is huge,” and that he hoped the measures would inspire other cities to act.

That would probably lead to more fights with union leaders. One of the biggest faces of the labor movement, Richard Trumka, the president of the AFL-CIO, reacted to the Democrats’ loss in Wisconsin Tuesday night by telling reporters that “the new model that Wisconsin’s working families have built won’t go away after one election; it will only grow.”

“Working families are more committed than ever to creating an economy that works for all,” he said.

Copyright 2012 ABC News Radio

Thursday
Oct272011

More Than a Dozen Charged in LIRR Disability Pension Scheme

Joe Raedle/Getty Images(NEW YORK) – Federal agents have charged more than a dozen suspects including a doctor, a union president, and Long Island Railroad retirees, in a disability scam that reportedly cost taxpayers as much as billion dollars. Ten of these individuals were arrested on Thursday.

The FBI uncovered hundreds of fake pension claims after the bureau started investigating why the cash-strapped LIRR had a disability rate three to four times that of the average railroad. 

The fraud was first exposed in a New York Times investigation and government action began soon after, with raids to seize documents and records at pension fund offices.

A network of doctors allegedly prepared false medical records and helped the workers file claims in exchange for cash payments. 

They face 20 years in prison if convicted. 

Copyright 2011 ABC News Radio

Thursday
Oct132011

Panetta to Service Members: ‘You Will Get What Is Promised to You’

TIM SLOAN/AFP/Getty Images(WASHINGTON) -- Defense Secretary Leon Panetta had some strong words on Wednesday for men and women of the military: “We made a promise and I intend to keep it.”

As the Defense Department considers how and where to make budget cuts to meet the over $450 billion it has been asked to make, military officials have been trying to assure service members that their retirement pay and health benefits will not be touched.

“We will stand by the promise made to you,” Panetta told a roomful of active-duty and retired service members Wednesday at the Association of the U.S. Army convention in Washington, D.C.

On Monday, Panetta spoke at the nearby Woodrow Wilson Center -- warning members of Congress to work together to avoid “sequestration" -- a mechanism in the Budget Control Act that would cut the Defense Budget by additional hundreds of billions of dollars if members could not agree on $1.2 trillion in budget cuts.

Panetta called sequestration a “goofy meat-axe approach,” that would bring about “salami slicing cuts of the worst kind.”

He warned members of Congress not to drastically reduce the military force.

“It’s a mistake we made time and time again,” he said.  ”It will not happen under my watch.”

Even so, he acknowledged the Army would draw down its numbers, and the “steep rise in personnel costs.”  But he appealed to the military services to work together, and ”weather budget storms as a team.”

And he said that all those who have served and were promised benefits would receive them.

“You will get what is promised to you,” he said.  “It is my duty.”

Copyright 2011 ABC News Radio

Wednesday
Jul202011

A Rhode Island City Turns to Pensioners to Avoid Bankruptcy

Comstock/Thinkstock(CENTRAL FALLS, R.I.) -- Central Falls, R.I.'s motto is "city with a bright future," but now its tomorrows are not only bleak, they could be nonexistent.

The densely packed community of 19,000, comprising an area a little larger than a square mile, faces bankruptcy and is calling on its bravest and finest for help.

The city's 141 retired firefighters and police officers were asked at a meeting Tuesday night to voluntarily give up as much as half of their pensions. It's called the "big ask," and with the library and community center already shut down, the city is running out of options to fix its dire financial prospects.

"It came as a shock yesterday [Tuesday] when it was presented to the pensioners," said William Zachary Malinowski, who has reported for the Providence Journal for 26 years. "If they don't give up a good chunk, they may end up with nothing."

The city faces $80 million in unfunded pensions and benefit programs, and a $5 million to $6 million deficit that shows no sign of decreasing in the coming years.

Under the proposed pension plan, anyone who retired at age 55 after 30 years on the job would see their pension cut in half from about $40,000 to about $20,000 a year.

Col. Joseph Moran served 27 years on the police force, contributing seven percent of his salary each month. Now retired, he stands to lose $1,000 a month. Making matters worse, workers here didn't participate in Social Security, so there are no other benefits to fall back on.

If retirees refuse the "big ask," Central Falls will likely have to declare bankruptcy, jeopardizing the entire pension system.

"I would advise a haircut looks better than a beheading," said a state-appointed receiver, Robert G. Flanders Jr.

Flanders would like a decision from the pensioners in the next seven days, Malinowski told ABC News.

"I could be wrong, but I don't see them taking it," Malinowski said. "I think this ends in bankruptcy."

Central Falls is not the first city to run out of the money needed to pay its retirees. In 2009, Prichard, Ala., stopped sending out pension checks to its 150 retired workers.

With the economy still sputtering and city budgets collapsing, similar "big asks" and broken promises could be coming to more towns.

Copyright 2011 ABC News Radio







ABC News Radio