This entry is part of the Director's Hub blog series. You’ll hear from our Director, Tom Reeder, about the importance of preserving pension plans and protecting retirement security. Check out Tom’s bio to learn more about him.
Last month we issued two reports: Projections Report (PDF) and MPRA Report (PDF). Both reports highlight the current financial state of PBGC's insurance programs, and predict future financial conditions. Given both reports' findings, many of you have emailed us and asked, "What does this all mean for PBGC?"
The financial condition of PBGC's single-employer program, covering 30 million workers and retirees, is likely (but not certain) to improve. Meanwhile, the multiemployer insurance program, covering 10 million participants and their beneficiaries, is struggling. If nothing is done, the program will likely run out of money by 2025. If the program runs out of money, participants in plans that receive financial assistance from PBGC-projected to be as many as 1.5 million participants and their families within 20 years-will find their benefits cut back drastically.
In his letter to Congress accompanying our reports (PDF), Department of Labor Secretary Thomas Perez, who is Chair of PBGC's Board of Directors, made it clear we need to take action now to save these benefits, and we're committed to working with Congress to do so.
The President's 2017 Budget proposed a structure for increased premiums under the multiemployer program at a level that would eliminate most of the risk of the multiemployer program becoming insolvent within 20 years. We look forward to working with Congress to develop a financially sound insurance program that protects the retirement security of 10 million participants and their families.
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