Michigan’s School Pension Fund Has A Great Year In The Market
A large $15.8 billion gain knocked down the level of
underfunding by 31%
Michigan’s underfunded public school pension system had a great year in the market in 2021, but it still has a lot of catching up to do before it can meet its promises to retired school employees.
Auditors report the pension fund earned a net $15.895 billion on its investments in 2021. That compares to investment gains in 2020 of $2.920 billion.
In 2020 the pension fund was $35.0 billion short of the amount actuaries estimate it will need to cover its obligations to employees. The 2021 report shows the amount of underfunding declined to $24.2 billion, a 31% reduction in just one year.
The investment returns reported gains of around $6 billion in 2014.
Ron Leix, spokesman for the Michigan Department of Treasury, said the investment return was the highest earned by the Michigan Public School Employees Retirement System since the early 1980s.
Michigan Capitol Confidential is the news source produced by the Mackinac Center for Public Policy. Michigan Capitol Confidential reports with a free-market news perspective.