House Republicans Can’t Count On Pension ‘Savings’

The Chair of the House Appropriations Committee, Bill Adolph, said Wednesday that that the Republican House budget will be introduced on May 28th, and referred to committee when the State Legislature returns from recess on June 3rd.

Adolph said that we should not expect a budget that goes above the $28.4 billion that Governor Corbett proposed in his February budget address.  There is, however, an interesting difference between the Governor’s proposal and what is reportedly being introduced by House Republicans.  The Governor was counting on $175 million in supposed ‘savings’ from his pension reform proposals – but revenue from pension reform will not be included in the House republican budget.

“You can’t put together a budget that is based on proposed legislation” Adolph said.

Corbett has been pushing hard on the idea that pension reform legislation must move quickly so that other budget items will not need to be cut – but that argument relies on a blatantly false premise.  Every expert who has looked at Corbett’s pension ‘reform’ proposals has agreed that his plan will do three things:

  • Corbett’s plan will increase the debt of the pension system;
  • Corbett’s plan will cost taxpayers about $175 million more annually;
  • New hires going into Corbett’s 401(K)-type retirement plan will cost the State about 50% more than if they had gone into the existing pension system;

The fact that the House Republican budget does not count on any savings from pension ‘reform’ may simply be, as Adolph indicated, not wanting to count their chickens before they’re hatched… but it may also indicate something else.  That no matter how many times the Governor claims that pension ‘reform’ will save taxpayers money, the legislators responsible for running the numbers on their budget proposal simply cannot turn Corbett’s negative into a positive.