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Multiemployer Pension Reforms Needed Now, Before It's Too Late

Partnership for Multiemployer Retirement Security Calls for Solutions in Wake of Sobering PBGC Projections Report

(WASHINGTON) - A new report out from the nation’s pension backstop shows that they will not have the funds to support retirees if troubled pension plans fail without changes to its present course. Nearly 1.5 million Americans in multiemployer pension plans across the country face a dire economic future according to a new report from the Pension Benefit Guarantee Corporation (PBGC), and reform advocates want Congress to act now to give plans the tools they need while it is still possible for troubled plans to avoid insolvency and preserve benefits at the highest possible level. Unless action is taken, current law mandates drastic, automatic cuts to pensions. Solutions Not Bailouts can prevent those cuts and preserve benefits to the greatest extent possible. The Partnership for Multiemployer Retirement Security made the following statement about the consequences of kicking the can down the road:

“This projections report confirms a frightening reality: with the PBGC’s deficits widening quickly, troubled multiemployer pensions impacting millions of Americans will need reforms, like those we’ve identified, to survive and continue to provide retirement benefits to these workers and retirees. Our plan ‘Solutions not Bailouts’ would give these troubled plans some of the tools they need to overcome funding challenges without a taxpayer bailout and to give others in better shape the opportunity to correct course before getting into deeper trouble.”

According to PBGC’s press release: “This year’s report projects that the multiemployer program’s FY 2013 deficit of $8.3 billion will widen to, on average, $49.6 billion by FY 2023. The projections in this report take into account both the improving economy and the new methodology. The improving economy has had a substantial effect. If the current methodology for projecting plan responses were applied to the economic circumstances a year ago, the average projected deficit for 2022 would have been $79.6 billion, rather than the $26.2 billion in last year’s report. The report measures the impact of the improving economy in several ways, and each measurement shows that the economy reduced the average deficit that would have otherwise applied by approximately one third.”

About the Partnership for Multiemployer Retirement Security
The Partnership for Multiemployer Retirement Security was formed in February 2013 with the release of “Solutions not Bailouts: A Comprehensive Plan from Business and Labor to Safeguard Multiemployer Retirement Security, Protect Taxpayers and Spur Economic Growth.” The recommendations in the plan were developed by the National Coordinating Committee for Multiemployer Plan’s Retirement Security Review Commission over a period of 18 months. The Commission studied the challenges facing the multiemployer pension system and designed a series of recommendations that safeguard retirement security and specifically address the challenges facing multiemployer plans. This comprehensive plan from business and labor, if enacted, will ensure that multiemployer plans continue their decades-long mission of providing cost-effective and reliable retirement benefits to millions of working class Americans while protecting taxpayers from risk.

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Posted 17:01PM on July 02 2014 by Jessica
Categories: Press Release