Ada — Oklahoma should move toward replacing its defined-benefit retirement plan for state employees with a defined-contribution plan, said a spokesman for the Oklahoma Council of Public Affairs.
“In the private sector, the defined benefit — the way it used to be, where you work all these years and you have a set amount, a defined benefit that you’re going to get — that’s just gone away in the private sector because it’s unsustainable,” said Brandon Dutcher, vice president for policy for the conservative think tank, “and so, we think we need to slowly move that way in the government sector as well.”
Dutcher touched on the state’s effort to reform its pension plan for public workers when he addressed the Ada Lions Club, which met Tuesday at the Aldridge Hotel.
The OCPA, which supports free enterprise and limited government, contends that Oklahoma must overhaul its pension system so the state can keep its promises to current and retired public workers. The think tank supports a defined-contribution plan for all new employees who would otherwise qualify for the state’s traditional pension program.
The OCPA says a defined-contribution plan would help state workers control their own retirement, and it would allow the state to pay off its pension debt with no future accumulating liabilities in 32 years.
Lawmakers have already taken several steps to reduce the state pension system’s unfunded liability from $16 billion to its current level of about $11 billion. Those measures included a 2013 bill that changed the years-of service requirement for new firefighters from 20 to 22 years.
House Bill 2078 also changed the vesting schedule from 10 to 11 years and raised the minimum age for receiving benefits to 50. The bill also changed contribution rates for cities and firefighters.
Gov. Mary Fallin signed HB 2078 into law, but she vetoed another bill that would have allowed new state employees to opt out of the traditional pension system in favor of a defined-contribution plan.