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NEW YORK Aug 18 Connecticut's unionized state
workers ratified a new cost-cutting contract, accepting bigger
penalties for retiring early and agreeing to help pay for
healthcare, just four days before thousands of lay-offs would
have taken effect, the governor said on Thursday.
"The real value of this agreement lies in the $21.5 billion
it will save taxpayers over the next 20 years in the form of
lower healthcare and retirement costs for state employees,"
Governor Dannel Malloy, a Democrat, said in a statement.
"When you negotiate in a respectful manner real fundamental
change is possible," he said in a webcast news conference.
Malloy parted company with many of his governor peers by
closing the state's big deficit with tax hikes, in addition to
Under the new contract, Connecticut public workers will
have to work longer and be older to retire, wait 10 years
instead of five to get retiree health benefits, and make a 3
percent contribution to a health care trust for a decade.
State employees hired after July 1 will not get longevity
payments, will have to work 15 years to qualify for retiree
health benefits and their pensions will be based on their last
five years of service instead of the highest-earning three
Saying Connecticut's government still has too many layers,
Malloy said there could be more agency consolidations.
Some lawmakers have doubted that the contract will succeed
in closing a $1.6 billion budget gap. Some recalculations will
be needed because the contract was approved later than
expected, he said, adding: "We will spell out over time how we
are reaching those savings."
In June, the 45,000-strong State Employees Bargaining Agent
Coalition rejected the same labor contract. The 15-member group
responded by relaxing its rules to make it easier for members
to approve the accord. A union spokesman was not available to
Malloy -- who had threatened even more draconian budget
cuts if the contract was again spurned -- said Connecticut's
politicians could never again put the state's finances in peril
by approving overly generous pay and benefit packages, noting
the state would follow the strict Generally Accepted Accounting
(Reporting by Joan Gralla; Editing by Dan Grebler)