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Fri Jun 28, 2013, 10:58 AM

 

Detroit Retirees Fret About Medicine in Orr Benefit Plan

By Chris Christoff - Jun 27, 2013

Detroit city retiree Rose Roots worries about the cost of prescription drugs, gasoline and house repairs. She never imagined anyone would cut her pension.

“It’s unbelievable that this day and time, in 2013, workers are threatened with being stripped of part of their pension and health benefits,” said Roots, a 76-year-old who worked three decades for the employment and training department. “Bankruptcy is one thing, but to start a remedy going after retirees?”

Shrinking benefits for 30,000 employees and retirees is part of Emergency Manager Kevyn Orr’s plan to avoid the largest U.S. municipal bankruptcy by erasing a $386 million deficit and reducing long-term debt of at least $17 billion. Orr proposes switching many retirees to federal health-care programs and eliminating pensions for employees with less than 10 years of service. His plan would also mean undetermined cuts to retirement checks.

The notion that pensions could be trimmed or wiped out is culture shock in the birthplace of the U.S. auto industry, where union strength dominates politics and negotiated benefits gave workers comfortable, middle-class lives over decades.

“That’s the way it’s always been,” said retiree Catherine Phillips, 55, who said she went to work for the city at 22 on her mother’s advice because of superior benefits. “I’m the first generation in my family who will not be comfortable. I’m going to be on edge.

MORE...

http://www.bloomberg.com/news/2013-06-28/detroit-s-retirees-fret-about-medicine-as-orr-targets-benefits.html

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