I’ve written many times about Rhode Island’s public sector pension problem, which is like an albatross hung around the necks of taxpayers.
Although some reforms have been made, retiring at a relatively early age on full or near full salary forevever has created an absurd situation of retirees, many of whom go out and get new jobs in “retirement,” being on the retirement payroll almost as long as they worked for the state or municipalities.
Thanks to reader John for forwarding this op-ed from the Montreal Gazette, reflecting that Canada has a similar problem:
Montreal’s problems with public-sector pension affordability are being mirrored in the rest of Quebec and indeed the entire country. Canada has become a land of pension haves and have-nots. There is a growing gap between public-sector-employee pension benefits and taxpayers who fund those generous goldplated pensions but don’t have one of their own.
The Gazette reported that the average police officer in Montreal is retiring at age 53 with a $59,000 annual pension. The average Canadian, by comparison, has only $60,000 saved in his/her RRSP.
The police officer will collect a pension every year for the rest of his/her life, worth an estimated total of about $2.6 million until age 84. The way things are set up, many public-sector workers will collect more income in retirement then they earned during their working careers.
This pension gap has been growing over the past 30 years and has now reached a level that is unsustainable economically, politically and socially. Taxpayers are being shortchanged and, without reform, things are only going to get worse.