UC President Mark G. Yudof recently announced his support for a proposal to alter employee pensions that would counter previous recommendations for pension policy made by his own UC Post-Employment Benefit Task Force.
Under the new retirement plan, faculty and staff members hired by the UC after July 2013 would contribute 15.1 percent of their annual payroll — 2.5 percent less than is currently called for by the UC Retirement Plan — to the pension program. Yudof’s recommendations are endorsed by the chair and vice-chair of the Academic Senate, the UC’s Staff Advisors to the Regents and members of the Council of UC Staff Assemblies. The Regents will discuss the proposal during a three-day meeting to be held at UCSF Mission Bay next week.
In a letter addressing the debate, Yudof said the plan will offset the UC’s budget deficit while preserving pension benefits for faculty and staff.
“When I established the Post-Employment Benefits Task Force, I made clear that the proposed changes needed to satisfy two critical objectives: Help address our financial challenges and preserve good post-employment benefits in support of UC’s commitment to excellence and in recognition of the vital role our faculty and staff play in the quality and delivery of UC’s service to the public,” Yudof said. “I believe these recommendations achieve those goals.”
Yudof said pension policy changes are what the UC needs in order to eliminate its $12.9 billion unfunded liability.
“Although the state has not yet agreed to pay its share of the UCRP, we have made some important strides on that issue this year and we will continue to press our case in Sacramento,” Yudof said. “In the meantime, we must take sensible action now to address our unfunded liability.”
UCSB Academic Senate Chair Henning Bohn said Yudof’s proposal will probably be approved by the Regents.
“My hunch would be that the president’s proposal would be approved unless people find some flaws in it,” Bohn said. “At this point it would probably take some real flaws and objections to stop it. I am more satisfied with how things have turned out than I would’ve expected a month ago. Yudof has come around and adopted, out of the proposals that are out there, probably the least objectionable.”
Bohn said that Yudof’s plan reflects the realities of the UC budget situation.
“I wish we were living in a world where we didn’t have to do this,” Bohn said. “We regret that pension benefits for new employees will be cut back. But at this point, the Senate’s view is that it’s not as bad as it could’ve been.”
UC Office of the President Spokeswoman Leslie Sepuka said the proposal represents an attempt to control costs while still offering benefits to prospective new faculty and staff.
“It’s equally important to maintain attractive, fair benefits for faculty and staff,” Sepuka said in an e-mail. “The challenge for the Task Force, and the president, was to strike a balance between offering the right levels and mix of benefits to attract/retain top talent while also controlling costs.”