URGENT: Tell Legislators to Protect Public Pension Funds from Political Influences
08/25/2016
Earlier this month, advocates wrote to the executive director of the Indiana Public Retirement System (INPRS) to make their opposition known against a proposal that seeks to use pension assets to fund an election year economic development project proposed by Gov. Pence.
Next Wednesday, the legislative commission which oversees INPRS’ policies and public pension issues – the Pension Management Oversight Commission – is set to discuss the program and its implications.
As a reminder, just prior to becoming Donald Trump’s running mate, Gov. Pence introduced a $1 billion (over 10 years) plan to “boost entrepreneurship and innovation” in Indiana. A hallmark of the proposal included the governor requesting that INPRS use pension assets to invest $500 million (half the cost of the program) in unnamed emerging Indiana companies.
It is unacceptable for the retirement assets of Indiana’s public employees to be influenced by political officials (including the governor) nor through any of their hired department heads—especially when the governor also appoints the INPRS board trustees who are entrusted to make the investment decisions in the first place.
As trustees, these individuals are charged with the highest fiduciary duty to the funds and the members of the funds. They should not be beholden to political whims and outside, special interests that have other agendas.
INPRS should focus on giving Indiana retirees high returns on their investments and mitigating risks. The framework of this latest program shifts the board’s attention away from these duties to follow the advice of non-experts who have a vested interest in engaging in particular types of investment.
Bottom line: This program does not create new investment opportunities for INPRS. It diverts assets for special interests thereby actually narrowing INPRS’s investing opportunities.
One needs to ask the question - If these types of investments were profitable, why wouldn’t INPRS already being doing it?