Illinois house speaker puts budget fix under review

CHICAGO (Reuters) - Illinois Governor Bruce Rauner's controversial approach to balancing the state budget will be the target of a new legislative panel announced by the house speaker on Friday. Michael Madigan, the powerful long-time head of the Democrat-controlled House, said the budget oversight panel would "closely examine" recent actions by Illinois' new Republican governor to plug a $1.6 billion hole in the current state budget. Those actions included $26 million in immediate cuts to healthcare and other programs that drew intense objections from groups that provide or rely on those services. “While I believe that a budget solution should include a balance of spending cuts and additional revenue, as a state it’s also our duty to protect our most vulnerable citizens, including children with autism, persons with developmental disabilities and lower-income women in need of breast cancer screenings,” Madigan said in a statement. He added it was important for Rauner to disclose how budget decisions were reached ahead of work on the fiscal 2016 budget. Rauner's office said bipartisan legislation passed last month to plug the current budget hole and "continued fiscal management steps taken by the administration" allowed the state to fund core state services, including prison guards, that were running out of money last month. "(Rauner) looks forward to working with the legislature to find a bipartisan solution that puts Illinois on the road to becoming the most competitive state in the country,” the governor's office said in a statement. The governor in February proposed a $32 billion general funds budget for the fiscal year beginning July 1 that reduces spending by $6.6 billion. A third of the savings would come from shifting state workers into less-generous pensions. Democratic lawmakers have questioned the viability of Rauner's plan to reduce Illinois' huge $105 billion unfunded pension liability. House Majority Leader Barbara Flynn Currie, who will head the panel that begins meeting on Tuesday, said lawmakers needed "a clear understanding of the governor’s methods and his math." "We can’t draft a budget with magic money that does not exist,” Currie said in a statement. Madigan stressed that bipartisan cooperation was needed to tackle Illinois' fiscal problems and he invited House Republicans to join the panel. (Reporting By Karen Pierog; Editing by Ted Botha)