Senator Shirley K. Turner (D-15) issued the following statement today in response to the plan that would result in double-digit rate increases in health benefits for public sector employees and retirees.
“This abruptly announced rate increase proposal is very troubling and not only raises a number of questions, it also underscores the need for greater transparency surrounding rate increases and even greater accountability for a non-profit company that has historically paid huge salaries and bonuses to its executives,” said Senator Turner.
“We are experiencing the highest inflation rate in 40 years, and a double-digit increase in health benefits costs, when everyone is paying more for everything from rent to gasoline to groceries, will create a severe financial hardship on public employees and retirees. It will also hurt our retirees who are living on fixed incomes and experiencing financial stress since they have gone without cost-of-living increases for the past 11 years. Everything is going up but the paycheck.”
“Our taxpayers deserve an explanation. Health insurance companies have made record profits, as fewer people make hospital and doctor visits,” added Senator Turner. “The rate increase proposal begs the question, how much of our taxpayer money is going toward enriching those at the top while the rest barely survive.”
For context, John Reitmeyer of NJ Spotlight News:
“Volatile financial markets continue to upset the bottom line for New Jersey’s public-worker pension fund, all while Gov. Phil Murphy and lawmakers have been working to bolster state contributions.
“The latest preliminary figures for the more than $90 billion pension fund indicate investment returns were running in negative territory through the end of May, echoing struggles that many private investors have been facing this year as markets have tumbled.
“As a result of the turbulence, the pension fund appears to be in danger of having its first full fiscal year with net negative returns in more than five years.
“Final figures are not available yet for the fiscal year that ended June 30, but the preliminary estimates, which are subject to future revisions, show negative returns of nearly 3% through the first 11 months of the 2022 fiscal year. Despite that poor outlook, however, this will have no immediate impact on the benefits now being paid for current retirees…
“Not surprisingly, the volatility has taken a toll on the pension-fund returns both for the calendar year and for the recently ended 2022 fiscal year, according to the preliminary estimates.
“For the calendar year, the pension-fund has been generating more than 6% negative returns, according to the early estimates, which do not include the latest performance of several asset classes that report to the state with a lag. Over the first 11 months of the 2022 fiscal year, the returns were running at negative 2.86%.
“Among the pension fund’s poor performers have been U.S. equities, which yielded nearly 6% negative returns through the first 11 months of the 2022 fiscal year. Bonds have also been disappointing, with U.S. Treasuries generating near 8% negative returns over the same time frame, according to the preliminaries.”