HARTFORD — Independent state budget analysts today said the projected pension fund savings touted by Gov. Malloy in the deal he struck with state unions fall more than $3 billion short of what was announced just five months ago. Over the 20-year horizon anticipated in the so-called SEBAC pension component, Malloy said it would save $4.8 billion, but the Office of Fiscal Analysis today put that number at $1.7 billion. House Republican Leader Lawrence F. Cafero said the union agreement savings is proving to be “fiction.”
“Just as in the other areas of the SEBAC deal concerning health care and other built-in savings, the pension fund savings are just one-third of what was budgeted. This is just more bad news,’’ Cafero said. He noted that a week ago Connecticut’s credit rating was downgraded because of skyrocketing pension and health care costs.
“We continue to struggle to meet our obligations despite the fact that Democrats put in place the biggest tax hike in state history,’’ Cafero said.
Just two days earlier OFA announced that not only was the state surplus gone just five months into the fiscal year, but Connecticut was actually in a $145 million deficit hole. Cafero said Democrats cannot continue to deny what non-partisan budget experts and fiscal analysts at Moodys Investment Services have found: Connecticut’s financial health is still shaky.
OFA said one reason for the loss of savings to taxpayers was that the individual components of the pension plan such as increases in employee contributions and the creation of a new tier of employees with less attractive different benefits did not add up to the aggregate savings Gov. Malloy announced.
Cafero said, “The legislature has to regain control over the state’s finances in the coming legislative session. We, as lawmakers, have to reclaim our responsibility to voters to rein in spending and get Connecticut back on track.’’