New York cuts pension benefits for public workers

The New York Legislature on Thursday passed a plan supported by Gov. Andrew M. Cuomo that will cut retirement benefits for future State and Local government workers. This plan will save over $80 billion for the state and local governments over the next 30 years. This would largely affect the middle class, blasted the union officials. Spiraling pension obligations are one of the top financial problems faced by State and Local governments across the United States. For New York’s municipalities, pension costs have risen more than 650 percent since 2002 to $12.2 billion in 2012, Cuomo said.

The new law creates a sixth tier of smaller benefits  for future State and local Government workers ranging from 3  percent for who earn $45,000 to 6 percent whose salary is $100,000 per annum. Further, the average salary taken into consideration for calculating benefits will be last five years instead of three and only $15,000 of a workers overtime salary will be taken for adjusting inflation.

 

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