Posted: Friday, 05 March 2010 5:00AM

How Are We Going To Fix Jersey's Big Pension Problem?

The Assembly Budget Committee held a special hearing - to better understand why Jersey's pension system is so under-funded, and discuss possible ways to fix the problem.

Fred Beaver, the Director of the Jersey Division of Pensions and Benefits told members of the panel the system was in great shape 8 years ago, but is currently under-funded by 46 billion dollars because unfortunately "we're not making any payments right now, so obviously we're not keeping the system in good shape- the other factor that impacts us is the return on investments has been poor the last two years - so it's had a pretty dramatic impact."

He also said proposed pension reform legislation should be approved and enacted, but even if all those bills are passed "they're just touching around the edges, because you're not really impacting anyone who's on the payroll today - it's only the future hires - so that's why it takes a much longer time for that to have any significant impact - until 2013 at the earliest."

Beaver added "a comprehensive study needs to be done of everything- for once, pay and benefits need to be considered in one package.

Assembly leaders have indicated they will not pass pension reform legislation already adopted by the State Senate until after Governor Christie delivers his budget address later this month.

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