PA Treasurer steps up criticism of Governor Corbett's pension plan

Written by The Associated Press | Feb 26, 2013 9:56 AM

(Harrisburg) -- Pennsylvania's state treasurer is teaming up with an ally of organized labor to oppose a key part of Governor Corbett's plan to overhaul the state's largest public employee pension plans.

Treasurer Rob McCord and economist Stephen Herzenberg of the left-leaning Keystone Research Center says a proposal to divert newly hired state workers into a 401(k)-style plan would not save money but instead would cost taxpayers more.

They say shutting off the existing pension plan would reduce investment returns for current employees that taxpayers would have to help make up, while requiring additional money for employees enrolled in the new plan.

State Budget Office spokesman Jay Pagni says they ignored the fact that Corbett plans to save $11.5 billion over 30 years by reducing future benefits for current employees.

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