Federal Pension Insurance Agency Marks Quarter Century of Protection
FOR IMMEDIATE RELEASE
August 31, 1999
The Pension Benefit Guaranty Corporation (PBGC) marks the twenty-fifth anniversary of its founding and pension protection mission on September 2. On that date, Labor Day 1974, the landmark Employee Retirement Income Security Act (ERISA) became law, insuring pensions for millions of American workers. Since then, PBGC has paid over $8 billion in benefits to retirees under private-sector defined benefit pension plans in the agency's care.
"Looking ahead, I hope American workers of the future will be able to participate in the traditional pension plans we insure so that they too will enjoy a predictable, secure pension for life," said PBGC Executive Director David M. Strauss.
PBGC now administers the retirement benefits of almost 500,000 workers and retirees who were covered by about 2,700 terminated pension plans. Nearly half of them worked in five major industries: primary metals; airlines; industrial machinery; motor vehicles and parts; and rubber and plastics. PBGC insures over 44,000 ongoing private-sector pension plans covering some 42 million workers, about one of every three working persons. Before PBGC, many workers labored without assurance of receiving the pensions they earned. In those days, there were instances where thousands of people lost all retirement benefits when their companies failed and could not keep pension commitments. Because of PBGC, this can no longer happen. When business failures occur and companies can no longer support their defined benefit pensions, PBGC will pay worker benefits as ERISA provides.
Other historical information, including a timeline of key events, can be found on PBGC's website. Also available is a new fact sheet providing information on pension insurance and the American worker in major industries.
PBGC's receives no funds from general tax revenues. Operations are financed largely by insurance premiums paid by companies that sponsor defined benefit pension plans and investment returns. PBGC had total assets of about $18 billion and liabilities of more than $13 billion at the end of fiscal 1998.
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PBGC No. 99-32