231 Pinetuck Lane Winston-Salem, NC 27104 Phone: 336-765-9765
July 10, 2004
The Honorable Judd
Dear Senator Gregg:
As the President of the Lucent Retirees Organization that embodies the interests of 235,000 retirees and their dependents, I am writing to you as the Chairman of the U.S. Senate Committee on Health, Education, Labor and Pensions to inquire what considerations are being given to much needed pension legislation.
Given the almost daily news reports that companies have defaulted on their committed pensions and other benefits, millions of retirees are concerned about the security of their pension and benefits trust funds. In an attempt to alleviate some of the fears of Lucent retirees, I recently sought advice from Bradley Belt, Executive Director of the Pension Benefit Guaranty Corporation.
Mr. Belt promptly responded to my letter with a number of good recommendations. He encouraged Lucent retirees to monitor the financial health of their pension plan. But he noted “unfortunately, at the moment, the only current pension funding information available to plan participants is found in corporate financial statements. These filings do not measure whether the plan is fully funded on a ‘termination basis’—that is, they do not tell participants whether the plan would have sufficient assets to guarantee payments of full promised benefits in the event of a corporate failure.”
According to Mr. Belt, this is a failure of the law that the Administration is working to correct. Reportedly, in its pension reform package submitted to Congress last year, the Administration proposed that all companies tell workers and retirees the true financial health of their pension plan each year, as well as whether benefits would be fully covered by PBGC’s pension guarantees. Mr. Belt said the PBGC also proposed that pension underfunding data currently available only to the PBGC be made available to the public.
It seems to the LRO that the PBGC’s proposals are well conceived. Can you tell me what legislation your Committee or any other Senate Committee is considering legislation that would provide retirees greater insight into the status of their pension and benefits trust funds? If you are not aware of an effort to correct deficiencies in pension reporting regulations, will you commit to sponsor such legislation?
The LRO is requesting that you provide a response on how you intend to help America’s retirees. Your response will be made available to millions of retirees through the LRO website and by sharing it with many other retiree organizations for posting on their websites.
Copy to: AARP and National Retiree Legislative Network