Do they still insist that? My unstudied feeling is that the current go to is "The officer acted in line with established department guidelines. We commit to reviewing the guidelines in light of this situation" with no accountability on any side to actually do anything.
Recall or arrest them. Once workers realize how poor leaders effect their livelihood explicitly, the problem tends to solve itself. Doubly so when we're talking about police unions here.
Well many government pension funds are horribly underfunded, so likely it would just add to the underfunding till eventually the government would bail it out.
It is an expensive, inefficient way to try and solve the issue - when they screw up this bad, you fire them - this is how every other organization works.