Fred touches on the "Holy Grail" of bennies in education that many are unaware of.........the "pickup"

From John Curry, September 17, 2009
Subject: Fred touches on the "Holy Grail" of bennies in education that many are unaware of.........the "pickup." Should administrators also pay their "fair share" for their retirement? Teachers have to!

Employee contributions and retirement ages should be increased, and the employee-benefit "pickup" should be phased out. (Pickup means the employer contributes all or part of the amount of pension contributions for certain employees; thus, certain employees contribute less than their fair share while their employers, the taxpayers, pay more than their fair share).

Ease investing rules for pension plans

Columbus Dispatch, September 17, 2009

Perhaps state law pertaining to public pensions needs revisiting. Could it be Ohio law and administrative rules governing public-pension investments are too restrictive and conservative? ("Pension plans outline reforms," Dispatch article, Sept. 10).

Recent equity-markets indices' lows were on March 9. Since then through Sept. 9, the Dow Jones industrial average, arguably the most-watched index in the United States and perhaps the world, has gained 45 percent, the broader Standard & Poor's 500, 53 percent, and the Nasdaq, 63 percent.

Corporate bonds have rewarded investors with capital appreciation in addition to relatively high current income (interest), and real total return the past 40 years compares favorably to equities.

I disagree with eliminating retirees' health insurance. This traditional benefit is a major part of employees' financial and retirement planning. Just because some employers have reneged on retirees' health-insurance promises doesn't make it right. To help keep health-care costs down, perhaps the pension plans and employers could institute financial incentives to encourage healthier lifestyles by employees, retirees and their families. The lump-sum death benefit likely is of nominal cost, as it is probably low-cost group term life insurance. Cost-of-living increases need not be eliminated.

Employee contributions and retirement ages should be increased, and the employee-benefit "pickup" should be phased out. (Pickup means the employer contributes all or part of the amount of pension contributions for certain employees; thus, certain employees contribute less than their fair share while their employers, the taxpayers, pay more than their fair share). It should be acceptable to base annual retirement benefits on a five-year salary average, rather than three years, resulting in a nominally decreased retiree income.

FRED D. STRAWSER
Lancaster