Pols ponder private pension plan
August 9, 2012
A controversial measure establishing this country’s first state-run retirement system for private-sector employees ran into a buzz saw of opposition Wednesday in its first test in the California Assembly. (San Francisco Chronicle)
Financial service, insurance and business groups weighed in against the bill by Sen. Kevin DeLeon (D-Los Angeles) asserting that the potential for billion-dollar losses for taxpayers cannot be risked, particularly in light of current fiscal conditions.
DeLeon’s measure would create the California Secure Choice Retirement Savings Program, making retirement plans available for nearly 7 million low-income workers. The bill has now been delayed in the Assembly Appropriations Committee after passage by the Senate.
Questionable performance of investment markets suggest that taxpayers will end up bearing the brunt of unfunded liabilities in the future, according to business interests.
“SB1234 is not a traditional pension,” De Leon told reporters. His bill would require employers to withhold 3 percent of their workers’ pay.