California state
employees take a stand for secure retirements...Thousands
of SEIU Local 1000 members join
sith other SEIU locals to tell Governor,
'Hands Off Our Nest Eggs'
SACRAMENTO, Calif., March 23 /PRNewswire/ -- Thousands of members of
SEIU Local 1000 wrote to Gov. Schwarzenegger today to tell him what
they plan to do with their modest retirements, which could be in
jeopardy if his proposals to move new workers to risky 401(k)-style
retirement plans succeed.
State
employees joined public employees in other SEIU locals for the
statewide "Hands Off Our Nest Egg" event. The event featured workers
writing personal notes about their retirement "nest eggs," which
will be stuffed inside colorful Easter eggs and delivered to the
governor as well as legislators voting next month on ACA 5, a
Schwarzenegger-backed bill by Sen. Keith Richman (R-Granada Hills)
to dismantle public employees' current secure retirement system.
"I wrote
that I hope to retire somewhere affordable in California, but with
these attacks there may not be any benefits left by the time I
retire," said Donna Debaecke, an Unemployment Insurance Appeals
Board management services technician participating at a San
Francisco worksite event, who noted that the average state pension
is only about $1,600 according to CalPERS.
State
employees like Debaecke worry that the governor's attacks on public
employees' pensions will have detrimental effects on current
employees and retirees, new workers, and taxpayers, including:
--
Outlawing stable defined-benefit plans and mandating risky
401(k)-style accounts for all new public employees, including
positions not covered by Social Security. The governor's proposals
ignore the facts that those in riskier defined-contribution plans
yield lower returns than stable pension plans, according to the
Dalbar and Watson Wyatt financial consulting firms, and that
retirees with pensions have income for life, while individual-risk
accounts can run out long before death. Plus the new individual-risk
accounts would not allow for inflation adjustments or death and
disability benefits, which are included in the current system.
--
Jeopardizing secure retirements for everyone in public retirement
systems including current retirees and employees. The governor's
proposals would mean fewer employees contributing to the current
plan, a smaller pool of benefits and weakened CalPERS investment
strength.
-- Costing
taxpayers more on many levels. In addition to millions in start-up
costs, the governor's proposals would require running two pension
systems with the individual-risk accounts costing more to manage:
the average cost of administering the current plan is 0.18 percent
of assets, while administering individual-risk accounts can cost as
much as 2 percent of assets, according to CalPERS. The
individual-risk switch would also cost taxpayers a quality public
workforce: with many public-sector jobs paying less than private
industry, a secure pension plan helps recruit and retain qualified
workers to public service.
"Higher
costs to taxpayers, fewer employees to provide vital services ...
Gov. Schwarzenegger's proposals don't make sense, unless he's just
trying to get more business for his Wall Street financial friends,"
said SEIU Local 1000 President Jim Hard, an Employment Development
Department employment program representative. "Californians need
improved public services, not attacks on those who provide them."
SEIU Local
1000 represents 89,000 rank-and-file state employees.
