The state legislature would be making a major mistake if it rejects the concession deal ratified Tuesday by unionized state employees. The deal would save the state nearly $1.6 billion over the next two years, achieving the savings Gov. Dannel P. Malloy set for the negotiations. It would provide a significant step toward closing the $5 billion shortfall Connecticut faces over the next two fiscal years.

More importantly, the concessions create a new and sustainable retirement plan for workers the state hires going forward. Employee contributions would in large part sustain this new hybrid pension/defined-contribution “Tier 4” plan. It would thus end the large state subsidies that have been necessary to fund the gold-standard pensions that state workers, particularly the most veteran, have enjoyed. The state’s past failures to set aside those pension funds has played the largest role in its serious fiscal problems.

While it is true the state would still have to provide large payments, roughly 10 percent of current state spending, to play catch up and cover the cost of pensions and benefits promised to current state workers, in time the cost curve will begin to bend in the right direction. Eventually, the Tier 4 deal will cut the anchor that has been a drag on efforts to navigate Connecticut back to fiscal health.

The ratified deal also includes immediate and significant concessions, including doubling pension contributions for most workers covered by existing plans, reducing the use of overtime to boost future pension benefits, increasing health care insurance premiums and co-pays, and requiring active workers to contribute more toward their retirement health care benefits.

Fourteen of the 16 labor coalitions, which collectively represent about 46,000 unionized state employees, agreed to a three-year pay freeze in return for protection from layoffs during that time. State police troopers and attorneys general did not join in that part of the deal and so would not get layoff protection.

Most controversial was the administration’s agreement to extend to mid-2027 the contract guaranteeing the revised benefits. That benefits’ deal is now set to expire in 2022.

Critics say it is wrong to tie the hands of future legislatures and governors by extending the deal so far out. Yet the union members deserved something in return for their significant concessions, and long-term protection from their benefits eroding further is reasonable.

If the legislature wants to count on the $1.6 billion in savings, it has to ratify the deal in special session. Usually, the legislature ducks this responsibility by waiting 30 days, at which time labor deals are automatically considered ratified. But that 30-day clock would not start ticking until the next regular session in 2018. The legislature cannot wait that long if it wants to include the savings in the fiscal year that began July 1.

If the legislature rejects the deal — a distinct possibility — it is hard to imagine finding a path to a revised deal with more labor savings. And without labor savings, closing the projected deficit could grow from difficult to impossible.

Republican legislative leaders contend they can find $2.2 billion in labor savings, but that would mean legislative moves to wring out more labor savings beyond the negotiated deal. The unions and their Democratic supporters in the legislature would react negatively, considering it a breach of faith after the striking of a deal. The concession package negotiated by the Malloy administration would fall apart, along with the savings.

Yet Republican reluctance to embrace the deal is understandable. Over the past three elections, the GOP has made significant gains in picking up legislative seats. In 2018, it could take control of one and, possibly, both chambers and win the governorship. Extending the labor deal to 2027 would limit its governing options.

Plus, being the party that opposed extending a labor deal could play well in the 2018 election, which means Democrats may have to hold their caucus together to approve it. Assuming Republicans unify in opposition, Democrats could not lose a vote in the Senate, split 18-18. A tie would allow Lt. Gov. Nancy Wyman to cast the deciding vote to ratify.

In the House, Democrats hold a 79-72 advantage and could afford no more than three defections.

If the legislature does approve the contract, it could provide the political breathing room for the bipartisan agreement necessary to finally approve a budget, now three weeks overdue. With a rejection, the budget impasse could drag on through the summer, with increasingly adverse impacts on both local and state services.

Approve the deal.

The Day editorial board meets with political, business and community leaders to formulate editorial viewpoints. It is composed of President and Publisher Timothy Dwyer, Executive Editor Izaskun E. Larraneta, Owen Poole, copy editor, and Lisa McGinley, retired deputy managing editor. The board operates independently from The Day newsroom.