MMA testifies in support of pension reform bill

At a hearing held by the Joint Committee on Public Service on April 7, Gov. Deval Patrick laid out his vision for Phase 3 of pension reform.

The proposed reforms focus on the long-term health of the pension system and would make changes that apply mostly to new employees.

The governor says his bill would add measures to combat fraud and abuse and would save the state and municipalities approximately $2 billion over the next 30 years.

The bill would extend the minimum retirement age by five years for nearly all future state and municipal employees.

The governor’s proposal would eliminate incentives for employees to retire at their minimum retirement age and increase the period of time used to calculate an employee’s pension benefit – from the highest three consecutive years’ earnings to the highest five – in order to more accurately reflect the employee’s career earnings.

The administration says the changes would better align public pensions with Social Security and private sector retirement plans.

The MMA testified in support of the governor’s proposal, calling it a fair approach to ensuring fiscal responsibility and the long-term viability of the public pension system.