We are glad to see President Easter and other university leaders throughout Illinois addressing the crisis in the state’s unfunded liabilities and the threat this poses to the pensions state employees have contributed to and planned on throughout their careers. As with other changes in state finances and their impact on the university, the proposals once again underscore the need for collective bargaining.
The proposal to increase employee contributions amounts to an immediate, permanent two percent pay cut at a time when faculty salaries at Illinois are already lagging behind peers. It also represents a permanent reduction in guaranteed retirement income, since the proposed change to the COLA limits and delays cost of living increases. An average salary increase of about four per cent would be required to offset this additional cost and the effects of inflation.
The plan also proposes to shift the pension burden to the University over time. Given the current and projected levels of state funding and the state’s inability to come up with even those funds, this is likely to add greater financial stress in the coming years. The university will either have to catch up on the quality of salaries and benefits, or suffer a further decline in its status.
The move from a defined benefit to a hybrid system would expose more recent Tier Two colleagues to market volatility, raising the possibility of continued problems for those basing retirement plans on this much less secure system.
Our most serious concern, however, has less to do with the details of this proposal than with the decision-making involved. As far as we are aware, President Easter arrived at his decision to support this plan without consulting the various campus senates, our senate benefits committee, or other shared governance bodies. The plan will now roll ahead without input from faculty or from other campus workers. Clearly, as it stands now the administration can make decisions about our current situation and even our futures without the consent of the faculty. The need for genuine consultation on such vital issues is one reason we need a union.
For those who might object that the problem is in Springfield and not in Urbana, this is another argument for and not against unionization. Legally, our academic senate cannot lobby on this or other issues even if it chose to do so. A powerful faculty union lobbying in concert with teachers and other public employee unions throughout the state would provide us a greater voice in Springfield to fight for better funding of the university and higher education generally. Without such representation, our futures will continue to be determined by others.
Jim Barrett, CFA President
(President Easter’s April 9, 2013 announcement was by mass mail; see also http://www.niutoday.info/2013/04/09/public-university-leaders-endorse-pension-plan)
Here’s a link to UIC’s United Faculty statement on pensions: