>In fact, according to Ron Gebhardtsbauer, senior pension fellow with the American Academy of Pension Actuaries, research confirms the notion that different levels of pension funding can be appropriate for different employee groups, including blue versus white collar – and that can be a valid way for lawmakers to proceed in pension reform efforts. The Academy conducted the research along with the Society of Actuaries.
>A New York Times story earlier this week quoted an actuary critic as saying that the provision in the latest pension reform bill from Representatives Rob Portman (R-Ohio) and Benjamin Cardin (D-Maryland) didn’t adequately differentiate the potential mortality of white-collar employees. (See Actuary Finds Fault with Portman-Cardin Pension Provision). If the mortality table flexibility survives in the Portman-Cardin bill as it wends it way through Congress, it could potentially save employers with blue-collar workers billions of dollars in pension costs.
>Regardless of questions raised about the Portman-Cardin bill, however, Gebhardtsbauer told PLANSPONSOR.com that the Academy believes:
- that a mortality table drawing a difference between white and blue-collar workers is an “actuarially sound and preferable” way to figure out how much employers should have to put into their pension plans
- that the blue/white collar distinction is a better way to differentiate workers than income level; some critics (including Edwin Hustead, the source for the NYT article) contend that how much a person makes has more to do with their mortality than their type of job
- that well-paid unionized employees (such as pilots or professional football players) should not be lumped into the blue-collar category.
>Gebhardtsbauer told PLANSPONSOR.com that the Academy has contacted Representatives Portman and Cardin with an offer to help lawmakers use the Academy’s research to effectively hash out the underlying pension policy issues. “I think those (Academy research) numbers can used to justify different mortality tables for blue collar groups compared to white collar groups,” Gebhardtsbauer said. “We’d love to help (lawmakers).”
« Final Comparability Regs Published