A MESSAGE FROM THE DIRECTOR
Every American worker should have access to a secure retirement. A vital part of that security for nearly 40 million workers, retirees, and beneficiaries comes from private traditional defined benefit pension plans. Our mission at the Pension Benefit Guaranty Corporation is to protect the predictable, lifetime retirement income that comes from those plans.
Our talented professionals work diligently to enhance retirement security and carry out our mission. We make sure that when a plan can no longer fulfill its promises to participants and beneficiaries, PBGC steps in and pays lifetime benefits up to the legal limits.
Our commitment is to make sure everyone gets their payments on time and to help plan sponsors keep their plans going. Currently, we pay benefits to nearly 840,000 participants in 4,845 failed single-employer plans. PBGC also provides financial assistance to 72 multiemployer plans covering over 63,000 participants currently receiving benefits.
The financial condition of our two insurance programs is among our top priorities as we look to the future. The financial status of the Single-Employer Program continues to improve. However, the Multiemployer Program faces very serious challenges and is likely to run out of money by the end of fiscal year 2025.
In light of these challenges, we continue to work with troubled multiemployer plans and their sponsors to provide advice and assistance to do what we can to help prevent plan insolvency. PBGC approved its first plan partition under the Multiemployer Pension Reform Act of 2014 (MPRA) for the United Furniture Workers Pension Plan A this year. Under partition, early financial assistance from PBGC along with required benefit reductions helps the plan to avoid insolvency and pay benefits to nearly 10,000 participants over the long term. But the tools PBGC has to address the multiemployer crisis are very limited. We have been working with stakeholders and policy makers to find new ideas for shoring up the program.
We engage and collaborate with the pension community, including participants, sponsors and service providers, on best ways to improve our practices. The feedback provided helps us learn what we can do to make it easier for plan sponsors to maintain defined benefit plans into the future. For example, in the upcoming year, the Corporation will implement a Mediation Pilot Program that allows an independent mediator to help PBGC and plan sponsors resolve negotiations more quickly.
The work we do is always with our customers in mind. Their feedback, whether negative or positive, gives us insight on how to enhance our operations to carry out our mission. With their input, we launched a newly redesigned PBGC.gov to create a seamless user experience for all of our customers. We want to make it easier to share important announcements with our customers as well as make it easier for people to engage with us, and this is one step in the right direction.
Our success is possible because of the support we receive from our Board of Directors – Secretary of Labor and Board Chair R. Alexander Acosta, Secretary of the Treasury Steven Mnuchin and Secretary of Commerce Wilbur Ross and their teams – in addition to our Advisory Committee and our own dedicated staff. As Director, I am immensely grateful to everyone who brings the promise of retirement security to the millions of people we serve in communities across America.
W. Thomas Reeder
November 15, 2017