New York City Mayor Rudolph Giuliani's announcement of dramatic cost-savings measures will have a significant effect on the city's $50.8 billion in pension funds.
The job cuts "will mean a savings for (city funds) because they won't have to contribute for these employees," said Kevin Berry, senior assistant press secretary for New York City Comptroller Alan Hevesi, investment adviser to the city funds.
He did not have a dollar estimate on the savings.
The city is offering a lump-sum option, but Mr. Berry said he couldn't discuss what impact that might have on the fund because of the different salary ranges and vesting levels involved and because employees still have not made their decisions.
Mr. Berry said there also might be "some decrease in deferred compensation assets to the extent that some of the (laid-off employees) had invested in the deferred compensation plan and will draw money out when they leave."
As part of his fiscal plan, Mr. Giuliani announced plans to cut 14,000 to 18,000 city jobs over 18 months.
The new mayor also seeks $200 million in savings from temporarily reducing the city's contributions to the municipal pension plans.
The mayor's steps were undertaken in an attempt to shrink a projected $2.3 billion budget deficit.