Labor deal will improve our finances and save taxpayers $24 billionJuly 21, 2017
Earlier this week unionized state employees voted to ratify a historic concessions package that will help Connecticut resolve the budget deficit.
Members of the State Employee Bargaining Agent Coalition (SEBAC) voted overwhelmingly in favor of the agreement - 83 percent to 17 percent. The agreement would save the state $1.2 billion over the next two years and $24 billion over its lifetime.
This not only goes a long way toward solving the current deficit, but puts Connecticut on a path to long-term fiscal stability. The agreement includes significant structural changes to pension and benefit costs, in addition to short-term measures such as furlough days and a wage freeze.
The agreement includes the following measures:
- An immediate wage freeze for three years
- Three unpaid furlough days in 2017-2018
- Higher payments for some medical services and drugs
- A 2% increase in employee pension contributions
- A new Tier IV hybrid pension/defined contribution retirement plan for all future hires
Full details of the package are available here.
In order for these savings to take effect, the legislature must vote to approve the agreement soon. l believe that, if approved, the concessions package will benefit the state and taxpayers for many years into the future.