CalPERS released an actuarial staff analysis outlining the costs associated with creating a hybrid pension plan for all new hires consistent with one of the goals outlined in Governor Jerry Brown’s Twelve Point Pension Reform Plan released in October 2011.
Overall, the analysis found that the hybrid plan will lower retirement benefits for new employees and shift the risk from employers to employees. It also may not significantly reduce costs for the State, but will result in savings for school employees and local public agency employers.
The cost analysis was prepared at the request of the Legislative Conference Committee on Public Employee Pensions and was delivered today to the Co-Chairs of the committee, Senator Gloria Negrete McLeod and Assemblymember Warren Furutani, and presented to the CalPERS Board.
The analysis outlines a number of assumptions and details provided by the legislative committee to complete the report that were absent in the Governor’s plan, including actuarial cost methods, retirement rates, plan design, mortality rates and other economic assumptions.