A teacher’s pension has long been a key perk of the low-paying job, but that benefit could be reduced under proposed state legislation.
Senate Bill 152 has caught the attention of teachers across Georgia because it would basically halve the pensions of new hires and substitute an investment savings account like those common in the private sector.
“We’re already hit with furloughs, pay freezes … . You’re going to make it impossible to recruit top talent in Georgia,” said John Palmer, a Cobb County teacher.
Sen. Fran Millar, R-Dunwoody, said he co-sponsored the bill because he’s concerned about the future solvency of the system, with the workforce aging and a large number of teachers set to retire.
“That’s why corporations stopped doing it,” Millar said. “They couldn’t afford it.”
The bill must go through two legislative sessions before passage, so there’s no chance of adoption this year. Millar said he’s not sure it will ever get adopted, and he expects it to be modified by analysis and debate.
As currently written, it would implement a hybrid retirement plan for teachers hired after 2016, part traditional pension and part 401(k). Teachers would pay into both, but would get a defined payout for only the pension portion while the other payout would depend on their investment choices.
Teacher advocacy groups argue that the current teacher pension system is well-run, and they worry about reduced contributions from future teachers eroding the solvency of the current system.
Verdaillia Turner, president of the Georgia Federation of Teachers, suspects a hidden agenda that would create more profits for the financial sector.
“It’s one of the most solvent retirement systems in the country,” she said. “So the only thing that we can figure out is they’re trying to help out some of their friends on Wall Street.”
Millar says there are plenty of “alarmists” who think the bill’s sponsors are “going after all of our teachers.” But he said he and his colleagues are merely trying to be prudent.
“Nobody likes to deal with these things,” he said. “But the world’s changed.”
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