Administration Wants Changes to Pension Program for New Hires
Get inside the halls of Philadelphia power with PhillyClout: Inside City Hall, the blog by the Philadelphia Daily News' city hall reporters.
Administration Wants Changes to Pension Program for New Hires
Catherine Lucey
The Nutter administration says that tomorrow they will transmit legislation to City Council that would change the city pension plan for any new city workers.
Managing Director Camille Barnett said the proposed plan would combine a traditional pension -- at a lower benefit than current employees receive -- with a 401K plan that workers pay into. New hires who want more than the pension offering could sign up for the 401K plan and the city would provide matching funds.
Because tomorrow is the final council session of the season, the bill could not recieve final passage until fall. But if it were to pass, any workers hired after July 1 would be retroactively subject to the terms, Barnett said.
Finance Director Rob Dubow said the plan would save the city $500 million over 30 years. "This is a financial move to ensure the health of our pension fund," he said.
The city is sending the legislation to Council just two weeks before labor contracts for the four municipal unions expire. According to the city, pension terms are set both through city ordinances and collective bargaining agreements. The police and fire contracts will be settled through arbitration, while the two non-uniform worker contracts must be negotiated.
Barnett said the legislation shouldn't be viewed as a message to the unions as contracts are negotiated. "The motivation is to bring the changes to the [pension program,]" she said.
Comment removed.- Comment removed.
Tango is very jealous. So is usehisleg— ephraim- How is a pension a freebie? All members pay into the pension (just like a 401k) - the difference is that they payout is a guaranteed amount. Yes- it is a better deal than a 401k because there is security - but I don't see how it's a freebie.— stuffies
- it's about time the city's pensions came into the 21st century. in private industry no one has a pension anymore. employees should save and be responsible for their own retirement, not the taxpayers of the city. i'm a little disappointed they weren't more aggressive though; e.g., why not put new employees in 401(k)s full-stop? $500mm over 30 yrs only works out to a saving of $17mm annually, which isn't all that much to a city budget of more than $1bn. baby steps, i guess— heinz guderian
- I'd like to see a generous 401k freebie. pensions simply don't work with the city. they must be funded and when they perform poorly, they require extra cash when the city can least afford it. and who trusts them to manage it well? no one, because they've done a terrible job. the only reason the unions like it is because taxpayers guarantee it.— dreinterests
- Everyone wants change, except the union.Obama wants change. It will never happen.
Follow Chris on Twitter
David Gambacorta spent a small eternity writing about cops, drug dealers and serial killers. Now he’s writing about power and politics – which sometimes reminds him of the old crime beat. He joined the Daily News in 2005. And yes, he knows you’re not quite sure how to pronounce his last name. E-mail tips to gambacd@phillynews.com
Follow Dave on Twitter.
Jan Ransom, a native New Yorker, joined the Daily News in 2010 after graduating from Howard University. She has since written about the difficulty of filing police complaints, tax deadbeats and life after violent home invasions. She joined the Daily News City Hall Bureau in 2011 and has plunged headfirst into reporting on administration budget battles and City Council shenanigans. E-mail tips to ransomj@phillynews.com
Follow Jan on Twitter
Sean Collins Walsh is from Bucks County and went to Northwestern University. He joined the Daily News copy desk in 2012 and now covers the Nutter administration. Before that, he interned at papers including The New York Times, The Dallas Morning News and The Seattle Times. E-mail tips to walshSE@phillynews.com
Follow Sean on Twitter
