Malloy’s Pension Deal is Good for Unions; Is it Good for Taxpayers?January 5, 2017
Gov. Malloy struck a deal with unions deferring pension payments. Are future taxpayers on the hook?
The CT Mirror reported in December that Gov. Malloy struck a new deal with with public employee unions. The deal, though, defers pension payments due before 2032 to a future generation.
More from the Mirror‘s Keith Phaneuf (emphasis ours):
Gov. Dannel P. Malloy announced a deal Friday with state employee unions that would allow Connecticut to dodge a fiscal iceberg by holding down annual pension costs otherwise set to spike over the next 16 years. But to get that relief, Connecticut would shift at least $13.8 billion in estimated pension expenses owed before 2032 onto a future generation.
Phaneuf goes on to explain the deal. Pension payments “that were supposed to drop as low as $300 million per year after 2032 would hover close to $1.7 billion in the 2030s and 2040s.”
The translation here? The deal makes no changes to benefit levels for state employees. Instead, it pushes some payments into future decades.
Gov. Malloy and unions leaders “praised” the deal, but some Republicans were concerned. House Republican leader Themis Klarides said the arrangement “does not include critical issues such as pension benefits.”
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