Richard Rogers: No need to fix a retirement plan that’s working

The state of North Carolina has one of the strongest retirement systems in the country. However, it has become apparent that some substantial changes may be coming to our system. Both the House and Senate are considering changing the Teachers’ and State Employees’ Retirement System from a defined-benefit system to a defined-contribution system, a change that would ultimately affect all state and local governmental employees and retirees.

North Carolina Retired Governmental Employees’ Association, the organization that advocates for over 60,000 employees and retirees, is questioning the need for such an overhaul.

Our strong retirement system has provided pensions for government retirees for more than 75 years. The current defined-benefit system ensures that our vested state and local governmental retirees who contribute 6 percent of their salaries to the pension plan will receive the pensions they have worked so hard for. We cannot afford to lose this benefit that attracts top employees to our state.


The defined benefit system implemented by North Carolina’s retirement system is comparable to other retirement systems across the United States. A 2011 study by the Program Evaluation Division of the N.C. General Assembly provided an analysis of the TSERS retirement system compared with over 80 government retirement systems across the U.S. Key findings indicated:

▪ The majority of states have defined-benefit retirement plans for government employees.

▪ Michigan and Alaska are the only states that require all new hires to participate solely in defined-contribution plans.

▪ Four states offer hybrid plans, requiring new hires to participate in both defined-benefit and defined-contribution plans.

▪ Choice plans are offered in a handful states, allowing the employee to choose between defined-benefit and defined-contribution.

We should not spend time trying to fix a system that is working. A change could lead to retirement uncertainty for hundreds of thousands of state and local government employees, and this has the potential to undermine our state’s economy.

All current retirees’ pensions should continue throughout their lives; however, if the legislature changes to a defined-contribution plan, future employees will be subject to a much less certain pension.

NCRGEA will continue to monitor this issue and support the continuance of a defined-benefit plan. In the end, we work to provide peace of mind for our teachers, police officers and state employees.

Richard Rogers
Executive Director, NCRGEA
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