THE EXPENSIVE cost-of-living increase in public employee pensions passed in the waning hours of this legislative session is even more fiscally irresponsible than it first seems. Although most state workers and teachers are not eligible for Social Security and deserve pensions that sustain them in their retirement, the Legislature's proposal is just too expensive for the state to afford. Governor Patrick should veto the legislation and take another look at a possible adjustment next year.
The most galling aspect of the pension increase is not the $120 a year boost for each retiree (in addition to their current $360 annual cost-of-living increases). Even when multiplied over several years of life and thousands of retirees in the system, an increase might be debated on the merits and measured against other state needs, such as healthcare or crumbling bridges.
The problem is that the legislation puts off even beginning to pay for the pension increases until 2024. That is just as the state's current large unfunded pension liability is scheduled to be retired. The Legislature's proposal would delay that date by three more years - long after most of today's legislators are safely out of office. It is irresponsible to saddle future generations of taxpayers with debt - estimated at more than $3 billion - to gain a political benefit today.
When the pension adjustment was first inserted into the state budget this spring, Patrick returned it to the Legislature with an amendment restricting the increases to retirees drawing pensions of $40,000 or less. This was a reasonable attempt to direct the increases where they were most needed. But budget conferees changed even that modest cost-savings so that it would be effective for only one year.
The Legislature at least retreated from an earlier version that pushed cities and towns to provide cost-of-living increases to municipal retirees. But the state retiree increase, accomplished with minimal debate and no recorded vote, is mischief enough.
Public employee pensions have unfortunately become a popular bete noire for limited-government types, who have seized upon some recent high-profile abuses to paint deserving retirees with the same broad brush. But the Legislature is not helping their cause with midnight raids on the state treasury.
