• While the single-employer program’s financial condition improved by $529 million, due largely to the effect of a change in interest rates and to investment gains offsetting new probable losses, the program still reported a deficit of $22.8 billion and an increased exposure to loss from underfunded plans.
• The multiemployer program reported a net loss of $99 million and a year-end deficit of $335 million, largely due to an increased provision for probable losses from expected future financial assistance to troubled plans.
• The PBGC’s future exposure to new probable terminations remains high with approximately $108 billion in underfunding exposure to plan sponsors, classified as reasonably possible, whose credit ratings are below investment grade or meet one or more financial distress criteria.
• Events subsequent to September 30, 2005, would have reflected a decrease of $2.9 billion in the PBGC’s net income and a decrease in the net position in the same amount had these conditions ccurred prior to year-end.
• The PBGC received its 13th consecutive unqualified audit opinion on its financial statements, which were released to the public 45 days after the end of the fiscal year.
• The PBGC continued to provide high quality service to its customers even as its workload grew in 2005. It paid nearly $3.7 billion in benefits to nearly 683,000 people and issued 178,000 final benefit determinations.
• At year-end, the PBGC was responsible for the pensions of nearly 1.3 million people. In addition to the 683,000 already receiving benefits, these include 510,000 people who will begin to receive benefits from the PBGC when they retire in the future and 103,000 who are receiving or will receive benefits through the PBGC’s financial assistance to multiemployer plans.
• PBGC action in the courts and in settlement negotiations resulted in financial recoveries that protected plan participants and the insurance program from hundreds of millions of dollars in unnecessary losses.
• The PBGC enhanced and expanded its electronic services for its customers through its separate Internet sites for plan participants and plan administrators.
• The PBGC became the first government agency to be given full certification by the Office of Personnel Management and the Office of Management and Budget for its executive performance system based on its linkage of organizational performance to executive performance.

Table - Highlights

Perspectives on the Year

The single-employer program’s deficit improved slightly as gains from interest rate changes and investment returns offset charges for new probable losses. Substantial losses from plan terminations in 2005 had already been recorded as probable in 2004.

The multiemployer program recorded an additional loss for the year due to additional probable losses for expected future financial assistance, worsening the program’s deficit.

The PBGC assumed responsibility for the benefits of 269,000 new participants during the year, a new one-year record, as total participants owed benefits approached 1.3 million.

While the number of PBGC-insured plans continued a slow decline, the number of covered participants reversed its previously increasing trend by decreasing slightly for the first time, from 44.4 million to 44.1 million.

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