April 25, 2023
WBUR recently published an article featuring Mark Williams, Master Lecturer of Finance, discussing the pension fund for MBTA workers.
To shore up the ailing pension fund at the Massachusetts Bay Transportation Authority, officials have long sought to raise the retirement age for workers from 55 to 65. This is largely due to the T’s current recruitment campaign to hire 2,800 workers to meet its staffing requirements. It’s a decision that came with a price. Expenses for the $1.6 billion pension fund could cause the MBA to be insolvent by 2038. 6,000 T employees are represented by the Boston Carmen’s Union, which is counting on new workers to contribute to the pension fund.
According to Williams, “Having the T pension plan funded at little over 50% is not sustainable. Union members and the T contributing less than what’s needed to support benefits is only part of the problem.”
The union countered that future pension funding will depend on several factors, including ridership, service and staffing levels, government subsidies and investment returns. According to the union position stated in the document: “There is no purpose served by speculating on these developments over the next 20 years.”