Asset Gains For All MA Systems Exceed Expectations
Since 2007, the Public Employee Retirement Administration Commission (PERAC) the state’s public pension oversight agency, has issued an annual Investment Report that summarizes the current investment returns and annualized past returns of all 104-retirement systems and the state’s PRIT Fund (Pension Reserves Investment Trust Fund). Created in 1998, PERAC is tasked with both oversight and regulation of the Massachusetts public retirement systems.
“I think PERAC has compiled another clear and concise report containing pertinent investment information that identifies the most recent returns (2023), along with historical data, which depicts the investment growth within all our retirement systems,” says Mass Retirees President Frank Valeri, who also serves as an elected member of the State Retirement Board. See Tables on pages 10, 11, & 18-19.
The 2023 Report not only shows the individual retirement system results, but it also calculates the state-wide composite of all systems, including the gains of the PRIT Fund.
A significant indicator that our retirement systems have established a great success story is that the average annual return rate for all systems, for the past 39 years, is just over 9%.
“The fact that our long-term historical return has exceeded our investment assumption for almost four decades is the reason why I feel so comfortable and confident to encourage local government and State leaders to share this success with retirees. In most cases, local and regional governments have done this, now it is time for all others and our state leaders to recognize that cost of living adjustment needs to be brought into the 21st century and improved,” continued Valeri.
“This is exactly why the creation of the Special COLA Commission is so important. By getting state leaders and pension policy experts together, we can figure out a new approach to this long-standing challenge. The goal is to improve the COLA base and develop a new benefit for long-term retirees.” The PERAC Investment Report also includes the funded level of each retirement system.
“In the July Voice, we reported on the 20 systems that are 90% fully funded or higher. We anticipate that the investment strategies and asset allocation of systems nearing full funded status will become more conservative, which can explain the differences in returns from one system to the next. However, the annual report is an excellent tool to review the overall health of our 104 retirement systems,” said Mass Retirees CEO Shawn Duhamel.