Auditor general to review state pension systems
HARRISBURG - State examiners will launch a fresh look at the pension systems that manage about $78 billion in assets for hundreds of thousands of public employees and retirees, the state's top auditor said Monday.
HARRISBURG - State examiners will launch a fresh look at the pension systems that manage about $78 billion in assets for hundreds of thousands of public employees and retirees, the state's top auditor said Monday.
Auditor General Eugene DePasquale told reporters that he is particularly interested in fees paid to outside investment managers.
"We're paying them a lot of money," DePasquale said in a conference call. "What are we getting in return?"
He announced the planned audits days after federal prosecutors filed false-statement charges against former state Treasurer Barbara Hafer and fraud counts against a Philadelphia-area businessman, Richard Ireland, over contracts he arranged for the management of state money.
There's no indication the pension fund audits have any direct ties to that case.
The State Employees' Retirement System and Public School Employees' Retirement System serves more than 850,000 workers, retirees and other members, according to the systems.
In addition to an examination of the role of external investment advisers, DePasquale said the audits will focus on the forfeiture of pensions of employees convicted of certain crimes related to public office, oversight of investment operations, and the diversity of the SERS and PSERS investment portfolios.
After past increases in benefits, caps on employer contributions, and poor investment performance, the unfunded liabilities of the systems grew to more than $50 billion. Republicans at the state Capitol have led efforts to change the retirement benefits earned by future workers.
DePasquale said the review will probably be complete early next year.
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