Public entities generally keep traditional pension plans; Cost and labor contracts are main reasons why adoption of defined contribution plans has lagged the private sector.(Benefits Management)

Byline: JOANNE WOJCIK

Concerns about whether public entities will be able to meet their future pension obligations are prompting lawmakers nationwide to scrutinize government workers' retirement benefits, with some states legislating ways to shore up the plans, such as raising retirement ages or increasing employee contributions.

For example, Kentucky Gov. Steve Beshear in June signed legislation that bumps up the retirement age for new employees and requires state employees to contribute 1% of their earnings to their retirement plans for the first time. The new law also shrinks annual cost-of-living adjustments from 5% to 1.5%.

In New Hampshire, Gov. John Lynch signed legislation earlier this summer that places a cap on the maximum retirement benefit state workers may receive.

This year's activity continues a trend sparked in the early part of the decade in response to poor investment performance by public pension funds. Since …