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Listen to Regents Retreat on Health & Pension Benefits
In the discussion on health and pension costs at the Sept. 12 Regents retreat, there were a number of disturbing elements. Some regents seemed to have forgotten their own 2010 decision to go to a two tier pension but retain the basic defined benefits format. The whole defined benefit vs. defined contribution debate seemed to start up again as if it had not occurred earlier.
Erroneous statements were made by one Regent that Stanford and Harvard had no pension plan, when – as was pointed out – what they have is a generous defined contribution plan (although not a defined benefit plan). It was said that now that the state has a new plan for CalPERS, etc., UC should conform to the state (although UC just made a considerable effort not to be included in the state plan after it initially was). In general, since the Regents are the trustees of the pension fund, their comments suggested a significant lack of understanding about basic information.
Several Regents suggested that if we cut the benefits, we could use the savings to raise salaries. But since benefits have preferred tax status and cash does not, on the face of it, moving a dollar from benefits to cash is a reduction in total compensation to the employee. This discussion was not the highlight of the retreat.
You can hear the discussion at:
