Senate approves 20 year pension catch-up w/o freeze

[FWAAA]

Good news for those who value their DB plans; bad news for those who predicted that AA would terminate its pensions:

U.S. Senate OKs 20-year pension break for airlines

Wed Nov 16, 2005 12:25 PM ET
WASHINGTON, Nov 16 (Reuters) - The U.S. Senate on Wednesday backed an amendment to pension legislation that would give airlines 20 years to fix funding shortfalls in the pension plans they sponsor.

The amendment, by Sen. Johnny Isakson, a Georgia Republican, was passed on a voice vote. It allows struggling airlines with underfunded pension plans to qualify for the relief without freezing their plans, so long as they immediately fund any future pension benefit promises.

The Senate was expected to approve the underlying legislation later on Wednesday. It would require companies sponsoring pensions to set aside more money for retirees over time and pay higher premiums to the deficit-ridden agency that insures the plans, the Pension Benefit Guaranty Corp. (PBGC).

http://yahoo.reuters.com/financeQuoteCompa...at004394_newsml

IIRC, the House has already approved a similar measure, so it looks like Arpey got what he wanted: 20 years to catch up the "underfunded" amount without the necessity of freezing the pensions.

 

[TIME FOR CHANGE]

Good news for those who value their DB plans; bad news for those who predicted that AA would terminate its pensions:
http://yahoo.reuters.com/financeQuoteCompa...at004394_newsml

IIRC, the House has already approved a similar measure, so it looks like Arpey got what he wanted: 20 years to catch up the "underfunded" amount without the necessity of freezing the pensions.

Bankruptcy is another option not to be ruled out

 

[Wretched Wrench]

If Congress will raise the employers' contribution to the PBGC, this would go along well. We need to worry about the PBGC being underfunded as well as our DB plans. The Bush admin wants to raise it from $9 annually per employee to IIRC $29.

Geeze, I would pay that myself to insure funding of the PBGC.

.

 

[AMFAMAN]

Geeze, I would pay that myself to insure funding of the PBGC.

.

Don't give the twu anymore ideas about what they could give back, they might take you up on this.

 

[PRINCESS KIDAGAKASH]

That's great news! Only problem is:In 20 years they(AA) will say they need more time or they just couldn't comply with the law. Airlines and other industries have failed to obey the present funding laws. What makes you think they will obey this new one?

 

[Wretched Wrench]

From the WSJ:

The matter now goes to the House, which is expected to pass a similar bill next month. But the White House says it is concerned that Congress's final bill won't put enough pressure on companies to keep their promises to employees, and has threatened a veto.


The administration said in a statement that it supported passage of the Senate bill, but "believes that the reforms in this legislation remain inadequate with respect to the level of required plan contributions and the premiums that are needed to return the PBGC to solvency and avert a taxpayer bailout."

 

[AMFAMAN]

The administration said in a statement that it supported passage of the Senate bill, but "believes that the reforms in this legislation remain inadequate with respect to the level of required plan contributions and the premiums that are needed to return the PBGC to solvency and avert a taxpayer bailout."

I guess it comes down to who is deeper into Bush's pocket, AA or the NWA/DL freeze them plan.

 

[Hackman]

On the national news a couple days ago, it showed a spokesperson for the PBGC stating it is seriously hurting for funds, and asking congress (taxpayers) for a bailout. The program stated that over a 120 companies have dumped their employees pensions on the government and tax payers.

The companies can't pay the employees' retirement, medical, or salaries. However, they have plenty of cash for outrageous CEO and upper management salaries, multiple retirement packages, paid for life medical, SERP bonuses, stock options...etc.

Its time for a national strike!!!! :angry:

http://www.marketwatch.com/news/yhoo/story...82EFFEE00AF9%7D

 

[mwa]

what about lump sum limitations - are there new funding levels or restrictions? remember Bethlehem steel was 85% funded on paper till the PGBC took them over and declared they were only 25% funded.

 

[Bob Owens]

On the national news a couple days ago, it showed a spokesperson for the PBGC stating it is seriously hurting for funds, and asking congress (taxpayers) for a bailout. The program stated that over a 120 companies have dumped their employees pensions on the government and tax payers.

The companies can't pay the employees' retirement, medical, or salaries. However, they have plenty of cash for outrageous CEO and upper management salaries, multiple retirement packages, paid for life medical, SERP bonuses, stock options...etc.

Its time for a national strike!!!! :angry:

http://www.marketwatch.com/news/yhoo/story...82EFFEE00AF9%7D

Only problem is you forgot that they still have the money for "Company paid Union Business".

 

[skyflyr69]

NATIONAL STRIKE!! right on, now your talking.