Public Pension Management and Asset Investment Review Commission Releases Report On Needed Reforms

Recommendations identify almost $10 billion in savings opportunities, propose other reform measures


Harrisburg, PA – State Representative Mike Tobash, Chair, and Pennsylvania Treasurer Joe Torsella, Vice-Chair, of the Public Pension Management and Asset Investment Review Commission (PPMAIRC) were joined today by Governor Tom Wolf and members of the General Assembly to unveil the Report and Recommendations of the Commission focused on cost efficiency and increased transparency of the Pennsylvania Public School Employees’ Retirement System and the State Employees’ Retirement System.


“The General Assembly has approved real and meaningful pension reform, but we need to do more. Our Review Commission met, and we are ready to make recommendations to the Governor and General Assembly. If these recommendations to the two public pensions systems are enacted, we will save taxpayers billions of dollars, reduce unnecessary risks and costs without compromising performance, and most importantly, keep our promise to existing retirees and system members.”


Pennsylvania Representative, Tobash

“Today marks a historic milestone signifying the completion of a first ever independent review of Pennsylvania’s largest pension systems. I am pleased to be alongside my Commission members to present a report that has not only identified savings well above the goal of Act 5, but also provides a roadmap that helps ensure the future viability of both systems and that commitment they have made to the beneficiaries. Every dollar that stays in the funds instead of going to Wall Street brings us closer to meeting that obligation.”


Pennsylvania Treasurer, Joe Torsella

The report comes after an extensive 7-month examination of Pennsylvania’s two statewide pension systems. Following a vote and the unanimous adoption of the Report and Recommendations, the Commission provided the Governor and General Assembly with comprehensive recommendations, including those listed below, along with identifying an estimated potential $9.9 billion in actuarial savings over 30 years calculated at the 7.25% assumed rate of return for both retirement systems.


  • Maintaining full payment of the annual actuarially determined contribution amount;
  • Establishing a consolidated Central Investment Office for both pension funds;
  • Enacting legislation mandating annual stress testing;
  • Moving to fully index all public market investments in both public equities and fixed income;
  • Establish transparency policies at both system boards that favor and encourage more open public reporting;
  • Enacting legislation mandating increased public reporting of all investment expenses; and
  • Adopting measures to reduce risk, including reducing exposure to illiquid private investments.

The Commission was established in 2017 under the broader pension reforms of Act 5 of 2017 to conduct a comprehensive review of PSERS and SERS investment management. As part of its evaluation, the Commission was required to:


  • Recommend improvements to SERS and PSERS stress testing and fee reporting transparency;
  • Analyze SERS and PSERS assets, investment strategies, investment performance, fees, costs, and procedures against established benchmarks; and
  • Develop a plan to identify $1.5 billion in cost savings over 30 years for each of the two systems.

In addition to Representative Tobash and Treasurer Torsella serving as members to the Commission, James Bloom, Michael Torbert and Bernie Gallagher have also been appointed to the Commission.

A copy of the Final Report and Recommendations is available here.

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