Benefits November 4, 2011

SC State Retirees to Receive Cut in Retirement Benefits

November 4, 2011 (PLANSPONSOR.com) – The South Carolina Budget and Control Board voted Thursday to cut retirement benefits for the state’s 137,500 retired teachers, police officers, and state employees, reports The State.

Reported by

Tara Cantore

According to the article, the vote also reduces the annual raises for retirees (COLAs) to 1% from 2%.

State lawmakers, who reconvene in January, said their priority for the 2012 legislative sessions is changing the state retirement system. Part of this change may be to require state workers to work more years before they can retire.

Thursday’s Budget and Control Board vote took two actions:

• Employer contributions to the state system, which includes teachers and state employees, were increased by 0.92% of salaries, or $71 million a year. Employer contributions to the police officers system, which also includes firefighters, were increased by 0.305%, or $33 million a year.
• The Board also changed several of the assumptions it uses in calculating how much money it will owe future retirees. The biggest change was reducing the assumed rate of return on the retirement fund’s investments to 7.5% a year from 8%.