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May 8, 2012 | By | Posted in Legislature

Corman: Pension reform better than higher taxes, spending cuts

Coming cost increases forcing PA officials to plan ahead this year
 
By Eric Boehm | PA Independent
 
HARRISBURG — Reforming Pennsylvania’s pension plans is the only option.
 

 
 
 
 
Corman said the pension situation is expected to play into this year’s budget discussion because of the coming increase, mirroring comments made in the past month by Gov. Tom Corbett, who has likened the pension crisis to a "Pac-Man" eating away at revenue that could be spent elsewhere in the budget.
 
Since most of the existing pension costs resulted from benefits state and public school employees have earned, any reforms would do little to solve the immediate crisis, but could defuse costs in later years by changing benefits for future employees.
 
Still, Corbett and Corman said they do not have a specific plan on how to reform the system at this time. 
 
“We’ll have to wait and see where the body is,” Corman said, referring to the General Assembly.
 
 
Many conservatives have advocated for a change from the existing defined benefit plan — in which pension benefits are guaranteed as a formula of years worked and salary — to a defined contribution plan where workers can invest a portion of their pay in a retirement account, similar to a 401(k) plan in the private sector.
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