is a former chairman of the Delaware County Council

Former State Sen. Vincent J. Fumo will soon start getting a six-figure annual pension, according to a recent report. If this sounds like a bit much, that's because it is. But it's only a small part of the problem.

In 2001, the leadership of the General Assembly, with the encouragement of public-employee unions, approached the governor with a plan to increase pensions for teachers, state workers and legislators. It seemed, said those advocating the increase, that the state pension funds had enjoyed excellent returns for several years. Therefore, the state could increase the pension benefits of its workers and teachers from 2 percent of their salary per year of service to 2.5 percent - a 25 percent increase.

With this level of benefits, an employee who put in 30 years could get a pension equal to 75 percent of the average of their highest three years' salary, instead of 60 percent. Most taxpayers would consider 60 percent more than fair, since most taxpayers receive nothing close to that.

Of course, the argument went that this would cost the taxpayers nothing, as the state would always earn 10 percent or better returns on its pension funds. There was little discussion of the possibility that returns could come up short and taxpayers would have to make up for it.

Well, a funny thing happened. It turns out the pension funds not only did not continue to gain at very high rates, but have in fact lost billions of dollars.

This is not to say that the pension fund managers have done a bad job; they are subject to the ups and downs of the economy much as we all are. But here's the rub: We taxpayers have now guaranteed high pension benefits.

The promised returns were an illusion, but the taxes won't be. Over the next few years, you will likely see massive increases in taxes, especially property taxes for local school districts. Estimates of the revenue needed are in the billions, and they will no doubt grow.

Day after day, we see articles about cuts in services and possible tax hikes because Pennsylvania is, like the rest of the country, suffering a huge drop in revenue. Our leaders are wringing their collective hands, trying to figure out the least painful way to surmount the financial problems they face.

Let me offer a partial solution: Go back to the 2 percent pension formula. The state's original assumption - that the pension funds would earn enough to pay for a substantial increase in benefits - was wrong. Given that, Gov. Rendell and the legislature should rescind the increase.

This would reduce our pension liabilities by billions of dollars and shrink future budgets. And if the funds are ever in surplus territory again, let's consider giving the break to the taxpayers. After all, they put up the money in the first place.