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Wed July 24, 2013
Raimondo: Pension Fund up by 11%, but Vulnerable to Economic Crises
Rhode Island’s pension fund earned a return on its investment of a little more than 11 percent for the fiscal year that ended June 30th. But state Treasurer Gina Raimondo is sounding a warning about the future of the state’s pension plan.
The 11.1 percent earned by the state pension fund is a big improvement over the 1.4 percent return a year earlier. Still, Rhode Island fared a bit worse than the 12.5 percent earned by the country’s largest public employee pension system, CALPERS, over the same period.
The performance of Rhode Island’s $7.5 billion pension fund was discussed during a meeting of the State Investment Commission. In a statement on her website, state Treasurer Gina Raimondo credits the commission with implementing a strategy that strives to deliver long-term returns while minimizing risk.
Yet Raimondo said that despite a major overhaul in 2011, the pension fund continues to pay out more than it receives each month. She says the state’s pension system has a limited ability to withstand another major financial crisis like the one in 2008 and 2009.
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