As private companies become more stingy with their retirement plans, Public Advocate Letitia James told a business group this morning she’d seek to create a pooled retirement fund for any New Yorker whose employer doesn’t offer a pension plan.
“Every New Yorker must have access to a safe and secure pension by 2030,” Ms. James told business leaders at a breakfast held by the Association for a Better New York. “This goal can only happen with the cooperation of employers, labor, and government working together.”
Ms. James said she would seek to accomplish that goal by creating a “centrally pooled retirement fund” for private workers by 2030, open to “all private-sector New York workers who currently have no access to a pension.”
Speaking to many private-sector employees, Ms. James sought to present the proposal as a win-win-win for the city, workers, and employers.
“Such a system could undoubtedly create a competitive advantage for private businesses here in New York. In addition to attracting and retaining employees, such a plan would offer employees an alignment of interest with long-term business growth, stability for their own lives and the hope of a retirement in place and with dignity, where they could continue to live, pay rent or a mortgage,” Ms. James said.
The proposal would be a significant expansion of local government’s responsibility for the private workforce, potentially a sort of miniature version of the nation’s Social Security system. Asked whether she thought New York’s workers had a right to pensions, Ms. James said she was simply responding to a growing retirement crisis.
“I think all of us need to be concerned about the looming crisis in 2030, the reality is the vast majority of New Yorkers in the year 2030 will not have a pension, and ultimately all of us will pay for it. So I think we really need to talk about our retirement security in the city of New York, otherwise we’ll see a number of retirees relying upon government programs and public assistance and that just is not sustainable in the city of New York,” Ms. James told the Observer.
The public advocate will introduce legislation to the City Council this month, she said, to create a seven-member “Private Pension Advisory Board” to study the possibility of a private-sector pension fund.
It’s not the first time the idea has been raised: In June, Comptroller Scott Stringer announced plans to form an advisory panel to examine ways to provide retirement options for sector workers in the city. That panel is in the process of being formed, his office said.
While Ms. James said the private pension fund could be run similarly to city and state employee retirement systems, she would leave the details to her proposed advisory board to determine.
“Right now what we’re proposing is a study bill, and we’re proposing an advisory committee that would really look at it. So whether or not it would be employee contribution, whether or not it would be matched by their employers, we don’t know — all of those things would be put on the table and we would look at the possibility of creating a private pension fund. This is nothing more than an exploratory bill,” she said.
Ms. James said she had not yet discussed the legislation with the Council or Mayor Bill de Blasio.
Speaker Melissa Mark-Viverito — who recently rolled out several policies to assist the city’s aging population — will be reviewing the plan.
“There are many challenges facing New York’s seniors, that’s why the Speaker announced several new proposals including the expansion of the Council’s Age-friendly initiative to all districts a few weeks ago. We look forward to reviewing the Public Advocate’s proposal,” said Eric Koch, a spokesman for Ms. Mark-Viverito.
Mr. de Blasio’s office did not immediately respond to a request for comment.
During her remarks — in which she also called for the creation of a city “Master Planner” position to take a bigger picture approach to what are often ad-hoc development decisions — Ms. James noted she may not be regarded as the most business-friendly city official, but said she was seeking to re-introduce herself to the business world.
“I fundamentally reject the notion that being pro-tenant, pro-union, pro-affordability, means being anti-business or anti-development,” Ms. James said.