Bruce Rauner believes pensions for state workers should be moved to defined contribution plans, which he admits will initially cost more to the state.
The Republican nominee for governor has advocated switching public pensions to 401(k)-style benefits for work past a certain date. While he hasn’t released the details of his plan, he admits there will be some up-front costs due to moving away from the current system, but he doesn’t believe that’s a deal breaker.
“That’s one of the problems we have. Everybody gets wrapped up in only one tax rate or only one budget, and we should think long-term, strategically, about our fiscal health overall,” Rauner said.
Rauner has said his plan would pay out benefits accrued by current workers and those who have already retired. That would include the 3 percent compounded annual escalator, which would be altered under the pension reform law passed last year.