Analysis: Pension cuts might save less than thought
SPRINGFIELD -- Number crunchers at the Illinois pension funds say a union-backed plan to cut public employee benefits might not save the cash-strapped state as much money as previously believed.
State Reps. Elaine Nekritz of Northbrook and Darlene Senger of Naperville told reporters Tuesday that legislation approved by the Illinois Senate could provide as little as $5 billion in immediate savings off the state's $100 billion in pension debt. The proposal, which would give employees and retirees a choice between pension benefit cuts or other sacrifices, had been predicted to save around $10 billion.
"We wanted to get the math out there," Nekritz said of the analysis by the state's four public pension systems.
The Senate plan has always been known to have less potential to save money than a package of deeper benefit cuts approved by the Illinois House and backed by Nekritz, so it's unclear whether Tuesday's numbers will make any difference in the debate. The House plan has been estimated to save about $28 billion out of the state's $100 billion in debt.
A spokesman for Senate President John Cullerton, a Chicago Democrat, said the pension funds haven't "provided a complete and accurate study" yet.
He and union leaders argue the House plan is more likely than theirs to get struck down by the courts, resulting in no savings.
That bill "seeks to illegally slash the life savings and contributions of working and retired Illinois families, and any alleged savings to the state are a totqal illusion," read a statement from the We Are One Illinois union coalition.
Senger and Nekritz tried to downplay the conflict between House and Senate leaders over how to solve one of the state's most pressing financial problems.
But with 10 days before the legislature's scheduled adjournment, the competing bills in the two chambers are far apart.
For a deal to get done, both chambers have to approve the same bill and send it to Gov. Pat Quinn, and neither side has showed signs of backing down.