Start messing around with a state employee’s pay or his retirement and you are guaranteed a full-blown controversy. So you can imagine what an uproar has been created with both issues now on the griddle at the same time.
Companies in the private sector have been changing to definedcontribution (401k) plans for some time now. They like the fact the cost of those plans is more predictable than it is under defined-benefit plans. Maybe so, but don’t look for any changes in state retirement plans for the time being. The memories of a national economy gone sour is too fresh in people’s minds. However, we can expect the issue to resurface in years to come.
A change in the merit pay plan for state workers is a different story. It should have been improved a long time ago, but no one had the courage to take the bold steps that are necessary.
People working in the private sector have to earn their stripes for promotions and pay increases, and the same should be true for state workers. The end result will be more efficiency in state government and better services for those who pay the taxes to keep it going.