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Puerto Rico Governor Will Not Impose Pension Cuts Sought by Board

Puerto Rico Governor Will Not Impose Pension Cuts Sought by Board
(Dollar Photo Club)

Friday, 20 April 2018 08:17 AM

Puerto Rico Governor Ricardo Rossello said on Thursday that he would not implement pension cuts and changes to employment rules sought by the bankrupt U.S. territory's oversight board.

In a written statement, Rossello said, "We will not propose any bill that reduces vacation and/or sick leave," adding that it was "wrong and immoral to reduce the benefits" of public worker pensions.

Rossello's statement came during a public hearing by the federally-appointed oversight board, which is tasked with helping the island regain access to capital markets amid the dual scourges of insolvency and natural disaster.

If Puerto Rican leaders refused to implement board-mandated measures, the board could sue to enforce them, setting up a potential court battle over the details of Puerto Rico's path out of bankruptcy.

The board was expected at the meeting to approve its fiscal turnaround plan for the island, which includes slashing government worker pensions 10 percent on average, though specific cuts would vary.

The plan would also loosen private-sector job security that is stronger than in almost any U.S. state, eliminate mandatory Christmas bonuses, halve paid leave, and condition minimum wage hikes on benchmarks like boosting dismal labor force participation.

The island filed the biggest government bankruptcy in U.S. history last year, with $71.5 billion of bond debt and $50 billion in pension obligations. It then suffered catastrophic damage from September's Hurricane Maria.

The board's plan forecasts $6.7 billion in debt payment ability for Puerto Rico through 2023, which is nearly $9 billion short of what the island owes in that time.

Rossello has vociferously opposed layoffs and pension cuts, while insisting the board lacks the authority to impose them without legislation.

© 2019 Thomson/Reuters. All rights reserved.

   
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Puerto Rico Governor Ricardo Rossello said on Thursday that he would not implement pension cuts and changes to employment rules sought by the bankrupt U.S. territory's oversight board.
puerto rico, governor, pension, cuts
276
2018-17-20
Friday, 20 April 2018 08:17 AM
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