JEFFERSON CITY -- Missouri government will chip in nearly $330 million next year to pay for state worker pensions, the increased cost largely because of lower investment return and longer life expectancies.
The governing board for the Missouri State Employees Retirement System approved a 20 percent increase – or $55 million – to help cover the cost for state workers' retirements. The retirement system, called MOSERS, covers about 51,300 state workers and 37,300 retirees. The increase takes effect July 2013, and the decision is binding on the Legislature.
The pension system lost $1.8 billion from the stock market's downturn from 2008-2009 while retired workers are living longer and therefore receiving pension payments for longer. In addition, some state workers are delaying retirement, which means they receive larger pensions after working more years.
The state budget included more than $270 million for the retirement system during the current year. State Budget Director Linda Luebbering said next year's increased state payment was not surprising.
I understand that pensions lost money in the market downturn, but I have trouble understanding why they have not recovered in today's much higher market, but then I don't pretend to understand high finance.