Printer Friendly


 WASHINGTON, Sept. 30 /PRNewswire/ -- Labor Secretary Robert B. Reich today announced a bill that would more fully protect retirement security for workers and retirees in single-employer pension plans insured by the Pension Benefit Guaranty Corporation (PBGC).
 "The financial future of many American workers and retirees may be at risk because their pensions are underfunded," said Reich. "I am determined to take all steps necessary to make sure their hard-earned pensions are safe and secure."
 Although, as a whole, pensions are safe, single-employer pension plans were underfunded by $27 billion in 1987, and their underfunding is expected to exceed $45 billion for 1992. Underfunding is concentrated in a few industries including steel, automobile and tire manufacturing and airlines.
 The Retirement Protection Act of 1993 would increase the security of workers' and retirees' pensions by requiring faster funding of underfunded pension plans and giving PBGC more compliance authority. It would require companies to give employees understandable explanations of underfunded pensions and guarantees afforded by PBGC. The bill would also require underfunded plan sponsors to pay higher premiums.
 "Most workers and retirees relying on these underfunded plans are not even aware of the risk they face. They only find out when it's too late," Reich said. "Workers have every right to know whether their pensions are secure. Only then can they make informed choices about their retirement and their future.
 "We will require employers with underfunded plans to provide their workers -- in plain language -- an explanation of their underfunded pension plan and the limits of PBGC's guarantee."
 The proposed legislation would also give PBGC more flexibility in protecting workers and retirees when corporate transactions potentially affect pensions. Currently, PBGC's only remedy is to terminate the plan. The agency could also require advance notice of any transactions involving more than $50 million in underfunded pensions.
 "With these reforms, underfunded pensions should be secure. I urge members of Congress to enact this bill so that America's working men and women can know their pensions are safe, their futures financially secure," Reich said.
 PBGC is a federal insurance corporation created by the Employee Retirement Income Security Act of 1974 to guarantee payment of basic pension benefits earned by American workers and retirees covered by private, defined benefit pensions. PBGC administers two insurance programs -- single-employer, which covers more than 32 million workers in about 65,000 plans, and the multi-employer program, which is not affected by the proposed reforms and covers almost 9 million workers in about 2,000 plans.
 This information will be made available to sensory impaired individuals upon request. Voice phone: 202-219-6060; TDD message referral phone: 1-800-326-2577.
 -0- 9/30/93
 /CONTACT: Bob Zachariasiewicz of the U.S. Department of Labor, 202-219-7316, or Judy Bekelman of the Pension Benefit Guaranty Corporation, 202-778-8840/

CO: Pension Benefit Guaranty Corporation; U.S. Department of Labor ST: District of Columbia IN: FIN SU: LEG

KD-PB -- DC0005 -- 7160 09/30/93 09:44 EDT
COPYRIGHT 1993 PR Newswire Association LLC
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
Printer friendly Cite/link Email Feedback
Publication:PR Newswire
Date:Sep 30, 1993

Terms of use | Copyright © 2017 Farlex, Inc. | Feedback | For webmasters