For Immediate Release: 10/29/2015
Contact: Zachary Janowski
Mobile: (860) 384-5777
Malloy Proposes Necessary First Steps
Unfair State-Employee Benefits Need Reform
Gov. Malloy issued a much-needed call for open public discussion about the future of Connecticut’s budget yesterday. The Yankee Institute agrees that we need to move toward a more sustainable – and fairer – approach, especially when it comes to paying state employees.
“State employees make an important contribution to our state, but it isn’t sustainable – or fair – to spend more on their benefits than is necessary to attract qualified people to do these jobs,” said Carol Platt Liebau, president of the Yankee Institute. “Many taxpayers don’t realize that while the best employers provide benefits worth about $29,000 to an average employee, the state provides benefits worth more than $50,000.”
We are encouraged by the administration’s desire to take a less risky approach to valuing state employee pensions. This year the pension fund only earned 2.8 percent, and the state assumes the pension fund will earn 8 percent a year. Continuing to offer these types of pensions is a risky proposition for taxpayers, since their cost is a moving target. The state should move all new hires to 401(k)-style retirement plans that are mobile, flexible and more predictable.
Administration proposals to make Connecticut a more attractive place for corporate headquarters, already a strength, are also promising.
Read more about state employee pay and benefits in Yankee’s latest study, Unequal Pay: http://www.yankeeinstitute.org/unequalpay/
The Yankee Institute for Public Policy is a Connecticut think tank that develops and advances policy solutions to promote smart, limited government; fairness for taxpayers; and an open road to opportunity for all the people of our state.