The bill was stalled by Mike DeWine (R-Ohio) after manufacturers and labor unions complained about the bill’s provision requiring companies in poorer financial health to pay higher premiums to the Pension Benefit Guaranty Corporation (PBGC) (See NewsDash – October 7 Rules & Regulators ). The bill would tighten funding rules for private pensions, which are underfunded by around $450 billion, and raise insurance premiums to $30 per plan participant Reuters reports.
According to Reuters, Senator Charles Grassley (R-Iowa), a sponsor of the bill, said he will not negotiate on the issue raised by DeWine. Another co-sponsor of the bill, Senator Mike Enzi (R-Wyoming), is threatening budget legislation that would raise premiums paid to the PBGC. The proposal is due to come to a vote on Tuesday in the Health, Education, Labor and Pensions (HELP) Committee chaired by Enzi, and would raise PBGC premiums to $46.75 per participant, per year, from the current $19.
Meanwhile, a Bush administration analysis that questioned whether the Senate legislation or the similar House pension reform bill would actually improve the finances of the PBGC, also complicates the argument for the bill.