SPRINGFIELD - A possible candidate for governor in 2010 announced a plan to revamp the state's pension systems Monday, saying it could save money and reduce government corruption.

State Treasurer Alexi Giannoulias, a Democrat from Chicago, said the proposal could cut $80 million a year in duplicated spending.

The plan also aims to put an end to the fraud and abuse uncovered by federal prosecutors in the Operation Board Games investigation.

''It's time we give our beleaguered pension funds the fresh start they deserve,'' said Giannoulias, who is among a handful of Democrats whose names have surfaced as possible gubernatorial candidates.

The proposal received a cool reception from some lawmakers and at least one of the pension systems.

''It is safe to say the Teachers Retirement System is opposed to this,'' said Eva Goltermann, spokeswoman for the pension plan that serves Illinois educators.

Giannoulias' proposal wouldn't change the benefit structure for the 270,000 people who are relying on the plans for their retirement benefits, including public school teachers, judges, university employees, state workers and members of the General Assembly.

It would alter the way the five state pension plans invest money by pooling their investments. The move could reduce administrative costs and management fees, saving between $50 million and $80 million, Giannoulias said.

The first-term treasurer also wants to eliminate fraud and abuse by imposing tougher ethical standards on pension employees and pension board members. Giannoulias said Illinoisans have been paying a ''corruption tax'' because of wrongdoing uncovered by federal authorities.

Prosecutors say political insiders like Antoin ''Tony'' Rezko, Stuart Levine and William Cellini have or have attempted to steer state pension business to certain companies.

''The cost of corruption is real,'' Giannoulias said.

The plan has the support of good government groups, who say the proposal could rebuild trust in Illinois government.

''The way to do that is to have tougher ethical standards,'' said Jay Stewart, executive director of the Better Government Association.

Gov. Rod Blagojevich issued a statement offering support for the concept.

''We support increasing efficiency and transparency of state government and the state pension systems, provided that all efforts are made to ensure the diversity among investment managers and protect the interests of annuitants,'' Blagojevich said.

State Sen. Kwame Raoul, chairman of the Senate Pensions and Investments Committee, also sound a positive note.

"I applaud the bold action. I'm glad to partner with the treasurer," Raoul said.

But, state Sen. Bill Brady of Bloomington, who is the ranking Republican on the pension committee, said some problems could be addressed without completely overhauling the system

Brady, who intends to run for governor in 2010, said there are less drastic ways to extract savings and improve ethics.

''You don't necessarily have to combine the systems,'' Brady said.

Brady said Giannoulias may be floating the plan as a precursor to a run for governor. Giannoulias spokesman Scott Burnham called that ''ridiculous.''

In a statement, TRS Executive Director Jon Bauman said additional ethics reforms are welcome. But, he said the cost of altering the current investment procedures could wipe out any of the potential savings.