El Paso to tackle pension deficit
US - The city of El Paso has agreed to contribute US$210m to help fund the $350m shortfall in the Firemen and Policemen Pension Fund.
The fund itself has proposed changes to its pension payouts. After years of discussions and negotiations, the city and the fund board of trustees came to an agreement to reduce the pension fund deficit.
The decision cames after it emerged the shortfall would almost double in 10 years and reach $1.4bn in 20 years if nothing was done..
The city agreed to contribute $100m on 1 July this year. This will be followed by a further $110m contribution to be made two years later.
In addition, the present 18.5% cap on city contributions will be removed and replaced by amendments with a more equitable and secure funding formula.
Since these amounts did not cover the whole of the deficit, the fund made proposals to change the pension conversion formula and contribution rates for current members.
It also suggested accrual rates, retirement eligibility and survivor benefit amendments for future members.
The pension fund board will be recommending these changes to the members for approval.
Latest stories
Updated: Key dates for pensions
PP has compiled a list of what to watch out for over the coming months.
BREAKING: LifeSight becomes first master trust to be authorised by TPR
Willis Towers Watson's LifeSight is the first master trust to be granted authorisation by The Pensions Regulator (TPR).
Croydon sets up asset-backed funding to reduce pension contributions
An innovative funding structure has been agreed for Croydon Pension Fund. However, there are some concerns about the arrangement. Stephanie Baxter reports
Half of pension scam red flags raised by schemes involves advisers, finds survey
Some 52% of red flags raised by schemes on suspected scam pension transfers involve advisers or unregulated introducers, a report by the Pension Scams Industry Group (PSIG) has claimed.
Back to Top
Most read
