TRENTON, N.J. (AP) — New Jersey Gov. Chris Christie held fast to his national reputation for fiscal discipline amid the widespread financial crisis that’s hit U.S. states, unveiling a $29.4 billion state budget Tuesday that calls for heftier contributions from state workers for pension and health care benefits.

Christie proposes paying $500 million into the state’s severely underfunded pension system—the minimum required under a new state law to get the state to quit skipping its payments. But Christie, who’s burnished national credentials as a take-no-prisoners fiscal conservative, says he’ll make the payment only if the Democratic Legislature agrees to reforms that require government workers to delay retirement and pay more.

Union workers, a powerful Democratic constituency in a legislative election year, oppose the plan.

Watch Gov. Christie’s Entire Speech …

Christie’s carrot-and-stick budget plan also targets public workers’ health care. His plan calls for additional property tax credits to poor, disabled and senior households—but only if the Legislature significantly increases public workers’ health insurance contribution.

Christie, who has made enemies with the powerful public teachers union since taking office 14 months ago, wants legislation that would push one-third of the cost of health insurance onto state workers by 2014, up significantly from the 1.5 percent of their salary they pay now. Christie would apply the $323 million in savings to property tax relief for low-income, senior and disabled homeowners.

Unions plan to rally at the Statehouse on Friday in support of public workers in Wisconsin, where protests have erupted over collective bargaining rights and public employees’ benefits are among the issues raising ire.

In a speech last week at the American Enterprise Institute in Washington, Christie urged elected officials to follow his example in addressing spending and debt, and big-ticket items such as pensions and other benefits.

“It’s time to do the big things—the really big things,” Christie said.

In New Jersey, Democratic leaders in the Legislature complained that Christie, through his budget, pits one group of middle-class residents against another.

However, the League of Municipalities, an association of municipal mayors, says it’s pleased Christie’s budget proposal holds the line on spending and aid to towns.

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