By Dan Berman
A proposed deal brokered by top Illinois officials to reform the state’s beleaguered public pension system was assailed by unions, which called the plan unconstitutional.
A coalition of unions representing a million members said proposed reductions in cost of living adjustments and changes to the retirement age were unconstitutional because they ignore collective bargaining rights. The We Are One Illinois group urged the million members it represents to call their state representatives and implore them to vote against the plan.
Under the deal reached by leaders from both parties
, the retirement age would be gradually raised for current worker under 45. Some workers can retire at 58. That would be raised as much as five years, depending on the plan. Cost of living raises would be tied to inflation and would be calculated using a formula designed to benefit workers receiving smaller benefits.
The plan is expected to save taxpayers $160 billion over the next 30 years. The state’s annual contributions to the pension fund would drop by about $1.4 billion because the amount of unfunded liabilities would drop as pension changes kicked in.
The union coalition posted an analysis of the proposal on its website that concluded the bill is similar to one defeated in the spring. State lawmakers are expected to vote on the current proposal on Tuesday.
“The scheme will blend unfair, unconstitutional elements from old, failed bills – such as cutting COLAs
by one-third or more, hiking retirement ages, undermining pensions by expanding 401(k)s, and other devastating pension cuts,” the union coalition said in a statement aimed at its members.
The state’s pension system is regarded as the worst-funded
in the nation. This year, the state is due to make $6 billion dollars in payments to the fund. In the past, lawmakers have skipped some payments causing the system’s problems to worsen.
Originally published on BenefitsPro.com