JANUARY 27, 2016, 6:44 PM LAST UPDATED: WEDNESDAY, JANUARY 27, 2016, 8:26 PM
BY SALVADOR RIZZO
STATE HOUSE BUREAU |
THE RECORD
Investment gains for New Jersey’s $79 billion pension fund fell sharply in the fiscal year that ended June 30, and those pension investments are in negative territory so far this year, state officials reported Wednesday.
Christie administration officials and the State Investment Council had acknowledged in July that, with 11 months of data, the pension fund was likely to see a sharp drop in its rate of return for fiscal year 2015. Now, with all 12 months of data, the state announced that it achieved investment gains of 4.16 percent, a tumble from 16.87 percent in the previous year.
New Jersey’s pension fund is the 17th largest in the country and 33rd largest worldwide – investing in everything from real estate, private equity, commodities, stocks, hedge funds and more. Nearly 780,000 public workers and retirees are beneficiaries of the pension system, meaning they depend on the success of those investments.
The state Supreme Court has said that public workers are entitled to their pension checks “when due.” If the money does not come from investment gains, it would have to come from state taxpayers or public workers.
The fund’s performance is in negative territory so far this fiscal year, down 3 percent for the July-through-December period, officials added.
Oh this is perfect fodder for Krazy Kime’s.agenda……he will be here soon.
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wait for it.
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wait for it.
Your right he is wiping up an post right now. Maybe he should be the one investing the money.
The government cannot guarantee pensions. The market is setting the price.
Just like a government general obligation bond, pensions are secured by a state or local government’s pledge to use legally available resources, including tax revenues, to repay bond holders. So actually the pensions are guaranteed. Nice try though 10:10 PM
Pensions and health benefits for state retirees in NJ for are not a constitutional right and they never will be
Given the public pension piggies already draw $9 billion a year in pension checks from the public trough, equivalent to 27% of the State’s annual budget – and growing faster than state & municipal budgets – what happens if these negative returns persist for a few years and the pension funds deplete? Oink oink! Good luck raising taxes to pay for pensions!
The pension and health benefit deal is too good, diminish the benefits
Crazy, right? The state and municipalities have promised defined benefit, i.e. Fixed amount pensions which means taxpayers have an unlimited liability to pay for public pensions. If this isn’t a good reason to shift all current public sector employees to defined contribution, i.e. 401(k) style plans I don’t know what is. Markets can go down, too. Why should taxpayers be guaranteeing lifetime pensions for the select few when the rest of us have less retirement savings when markets fall? Insanity.
And there he is…..Krazy Kime sighted at 12:05, 12:36, 12:47 am and 1:02 pm. Welcome back Krazy Kime.
4% in FY6/15 and -3% in FY6/16 don’t look very good versus assumed state pension rate of return in NJ at 7.95%. Looks like assumed rate of return is too high and should be cut to 5% which will swell the unfunded pension amount. The state also has to update their actuarial assumptions on lifespans given the new data shows people live longer by a few years more than the state currently assumes, so that will also increase the liability. Only way to offset that is limit when public pensioners can start drawing pensions to age 62, shift current employees to defined contribution plans, and ask current employees to contribute much more of their wages towards their own pensions