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Researchers: CT pensions protected

December 14, 2018

A new survey of Connecticut’s troubled public-pension programs indicates that in the event of an economic downturn, the retirements funds would be protected from new risk.

Governor Dannel P. Malloy hailed the The Pew Charitable Trust’s study, which supports changes made in the State Employees Retirement System that can be used to eventually prop up the Teachers Retirement System, which is in an even deeper crisis as the state faces $100 billion in unfunded liabilities.

“This analysis demonstrates that actions we took to restructure and reform the State Employees Retirement System have been incredibly effective and provide the path for what we need to do with the Teachers Retirement System to greatly improve the state’s financial future,” Malloy said. “It is now incumbent on the next administration and General Assembly to use this stress test and available data and resources to put the teachers’ system on a sustainable and solvent course.”

In 2011, the coalition of state unions approved the restructuring of the plan, with follow-up actions in 2014, 2016 and 2017, reducing the cost of future retirement benefits, which current amount to more than $1.9 billion a year for more than 54,000 retirees.

Tactics included reducing the assumed rate of return on investments in an effort to avoid projected $5-billion annual payments in 10 years.

Pew’s study, called a stress test, was required as part of the 2017 state budget.

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