MBTA wants to take an ax to retirement benefits

Boston Globe | By Adam Vaccaro | June 26, 2017

Future MBTA retirees would receive reduced pension payments and would have to work longer to earn the maximum benefit under a proposal to be unveiled at the transit authority’s board meeting Monday.

James O’Brien, president of the Boston Carmen’s Union, Local 589, which negotiates the pension contract, responded to the proposals by criticizing Shortsleeve as being more focused on “bean counting” than on improving service on trains and buses.

The T’s contribution to the pension fund is about 5 percent of its operating budget, O’Brien said. That compares favorably with other major transit systems, according to an economist working for the union.

“If he can’t pay my members a pension, he can’t pay for anything at the T,” O’Brien said.

As it works to find savings to fund service improvements, the T has stepped up its criticism of the $1.5 billion pension fund.

Officials say that the fund is financially unsound because of the increasing disparity between the number of retirees and current workers, and that its middling investment returns over the past three years have not helped.

With no changes, the plan could need an additional $1 billion over the next 18 years, according to the T.

The union disputes that forecast.

O’Brien has argued that Shortsleeve is overstating the fund’s troubles by projecting overly pessimistic returns of about 4 percent in coming years….

O’Brien also criticized Shortsleeve’s plan to deduct pension pay based on Social Security benefits.

“He’s taking Social Security away. Let’s call a spade a spade,” O’Brien said. “I don’t know why he preys on the most vulnerable people, which is senior citizens.”

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Permanent link to this article: https://carmensunion589.org/2017/06/mbta-wants-take-ax-retirement-benefits/