NEWBURGH – A proposed Tier VI pension level with an optional 401 (k)-type retirement plan is “a bad bet for taxpayers,” according to the president of the Hudson Valley Area Labor Federation.

The governor has proposed creating the new step as a means of saving the state money, but Labor Federation President Paul Ellis-Graham said creating private accounts “amounts to a risky privatization scheme that could underfund” the state’s pensions.

“In many cases public workers have taken lower wages and salaries throughout their lives in order so that when they retire at least there is a pension then can count on,” Ellis-Graham said. “With defined pension benefits as has been the case, usually workers know what they are going to get, but when you change the system and you decide workers are not only contribute more, but also put them at the mercy of the marketplace, they are going to stand to lose.”

A state comptroller’s report “validates CSEA’s position that the governor’s proposal for Tier 6 is bad for all New Yorkers,” said CSEA Regional President Billy Riccaldo. “A 401k system would jeopardize the stability of the current pension system, one of the most stable pension systems in the country and one into which our members have contributed a substantial amount of their earnings.”