Examining the Staggering Cost of Pensions
CF senior policy analyst James Paul recently spoke with WURD Radio’s Stephanie Renee on Pennsylvania’s skyrocketing pension costs—and what can be done about them. Pennsylvania’s unfunded pension liability stands at more than $60 billion dollars, two times the annual General Fund budget, and it keeps growing. In short, state government is making promises it can’t keep.
Pension costs are also eating up new education funding. State spending on education has risen every year since 2010, and this year it is at an all-time high. Yet, pensions costs are taking a bigger and bigger chunk of education funding—meaning dollars targeted to education aren’t going to the classroom.
James explains that the answer is structural reform to our pension system. Switching to a defined contribution system will allow portability and affordability, giving employees more choice and helping protect taxpayers in the long run.
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