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News & Policy

PBGC restates Administration support for prompt passage of interest rate relief

December 08, 2003

WASHINGTON - PBGC Executive Director Steven A. Kandarian today urged the Senate to approve legislation providing plan sponsors with two years of a corporate bond interest rate to discount pension liabilities.

"Two years of interest rate relief already has the support of the House, the Senate and the Administration," Kandarian said. "It is important that this issue not be further delayed by efforts to expand upon the provisions already approved by the House."

The Administration affirmed its support for interest rate relief on July 8 when it released a proposal that would allow pension liabilities to be discounted at a corporate rate for two years, followed by a more accurate measure that would discount pension liabilities using a corporate bond yield curve.

The Administration reaffirmed its support for two years of interest rate relief on October 8, when it issued a Statement of Administration Policy endorsing H.R. 3108 as "an important first step toward providing a permanent replacement for the interest rate now used to determine pension liabilities."

"The Administration and the PBGC strongly support two years of interest rate relief as we work with Congress on permanent solutions to the challenges facing defined benefit pension plans," Kandarian said. "The Senate has one last chance to approve this sensible approach."

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PBGC No. 04-14