Monday, March 12, 2012
Wisconsin retired public employees face more pension cuts
Tens of thousands of retired public employees in Wisconsin whose pensions have been reduced for four straight years probably will see another cut in 2013.
For tens of thousands more, pension payments will remain frozen at levels that in many cases fall far short of the rate of inflation.
The situation is unprecedented in the history of the plan that covers most teachers and government employees - Milwaukee County and city workers are an exception - in the state.
Many people in the Wisconsin Retirement System have seen their pensions sliced by 11% since 2008. And it would take an extraordinary investment performance to avoid a further reduction next year.
Not everyone is taking cuts. Wisconsin guarantees public retirees that they won't fall below their initial pension level. People who have reached that mark - a rapidly growing number that next year will exceed half of all retirees - are exempt from further reductions.
But that also shrinks the pool of retirees eligible to absorb a cut, and increases the size of the reduction for them.
"Fewer shoulders to bear the burden," said Keith Brainard, research director for the National Association of State Retirement Administrators.
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