New Jersey’s Pension and Health Benefit Study Commission has issued its final report on reforms it says are needed to prevent public employee benefits costs from overtaking other budget priorities.
Commission member Tom Healey says despite unprecedented levels of funding and the dedication of the state lottery to the pension plans, the state’s estimated unfunded liability is now $90 billion, $10 billion more than in 2014.
“While some progress has been made it has not been enough. The new Governor, the Legislature, public employees, and the citizens as a whole need to act to effect the comprehensive reform the commission suggests to make these benefits both affordable and secure.”
The commission recommends public employee health benefits be reduced and the savings dedicated for pension payments.
Without more reforms, commission member Tom Byrne says required pension payments won’t leave much money in the state budget for other priorities.
“We need to do it before the pension system becomes the Pac Man that ate both the rest of the state budget in terms of discretionary spending at least and ate the retirement security of 800,000 New Jerseyans that depend on the pension system.”
Byrne says the pension funds will run dry in 12 to 14 years without additional reforms.
“There were certain people who wanted a stalemate until now thinking that they would get a better deal in a new administration. The fiscal constraints that exist aren't going to change and I think the sooner reality sets in about that the better off we’ll all be.”
Governor Chris Christie says the Commission’s report is a blueprint for the next administration to consider.
“I hope this is a Nixon goes to China situation. I hope it’s that a Democratic administration and a Democratic administration can speak truth to these unions and make them realize there’s no place else for them to go.”