By Elizabeth K. Kellar
Center President & CEO
What can state and local leaders do when facing the perfect storm of dwindling revenues, increased service demands, an aging workforce, entrenched public cynicism, and the need to better fund retiree benefits? The answer to these challenges is neither quick, nor easy.
Earlier this month the Center convened a meeting with retirement administrators, academic experts, and diverse policy leaders to talk about the future of retirement. It was heartening to hear thoughtful people discuss what changes are needed to strengthen retirement systems.
They were clear-eyed about the mischief that has occurred within some systems and the need to build in more discipline and a standard funding policy. The group agreed that states and localities should establish a benefits policy that cannot be changed in just one legislative cycle. To attract and retain talent, a good benefits package is needed. They suggested that the public sector do more to define what rewards are appropriate for a career of service, price the normal cost of that reward, and establish statutory contributions.
Public confusion is more common than public understanding. The public often presumes that the very large unfunded liability for retiree health care fits into the same bucket as the decline in pension assets. Smoothing practices, public employee contributions to their retirement plans, and the unique nature of many public service careers are not well understood. The Center’s research and data have helped shed light on many of these questions.
So in this holiday season, we wish for greater public understanding, an improved economy, and courageous leadership in 2010.