VIDEO: Head of teacher pension fund says state will need to cut retiree COLAs
7 months, 1 week ago
IFT calls for TRS Director Richard Ingram to resign
(Crain's) — The head of Illinois' largest pension plan strongly suggested that cuts in cost-of-living benefits are inevitable for more than 360,000 teachers and retirees outside of Chicago.
In an interview with Crain's editors and reporters, Richard Ingram, executive director of the underfunded Illinois Teachers' Retirement System, said state politicians will have few other options if they want to make meaningful progress on closing the gap between promised pension benefits and the available funding.
“Look at every other state that's done pension reform – what have they done? They've changed the COLA because that's where the cost is,” Mr. Ingram said, noting that 25 percent of TRS payments are for cost-of-living increases on pension benefits.
Changes in cost-of-living adjustments could be targeted so they have the least impact on the oldest retirees and those with the lowest incomes, he said.
“If that is where we need to go in Illinois, then we can do it in a manner that is targeted and effective and protects those that need it the most and, at least to a large extent, get the job done,” Mr. Ingram said.
Read more: http://www.chicagobusiness.com/article/20121003/NEWS02/121009921/head-of-teacher-pension-fund-says-state-will-need-to-cut-colas#ixzz295V6PIaQ
Mr. Ingram fails to mention in his many interviews that teachers in the system have already paid for the cost of living benefits he wants to cut—their payments are built into the contribution calculations they are required to make in every paycheck. In addition, it seems not to matter to Mr. Ingram that the Illinois Constitution expressly forbids the benefit cuts he finds so attractive. Mr. Ingram says the Constitution is “unfortunate.” We say it is just and fair.
Mr. Ingram may think that he can mislead the members of the TRS Board of Trustees into believing that his remarks do not violate their fiduciary responsibility or their own resolutions regarding TRS advocacy. We have more faith in the board members than that.
Mr. Ingram would like the public and other unions to believe his comments are merely an intellectual exercise and are not meant to promote his own preferred solutions to the pension crisis. To this we say, “We will not be fooled.” The Teachers Retirement System must work for its members, not the politicians, corporate executives, or newspapers its leaders may be bullied by.
When the fox is guarding the hen house, it is the fox that must go. Mr. Ingram has lost the trust of those he is employed to protect. He should resign from his position as TRS executive director.