Pension Bill May Benefit Employees--Maybe Employers Too Wall Street Journal (04/17/03) p.C1; Schultz, Ellen E.; Francis, Theo
The Pension Preservation and Savings Expansion Act of 2003 will cost taxpayers about $100 billion or more, but would allow employees to contribute more to their retirement plans in 2004, and it includes numerous provisions to aid financial companies, executives, and employers. Under the proposed legislation, employers could pay smaller lump sum payments to departing workers, contribute less money to failing pension plans, continue to protect pension plans for executives during bankruptcy proceedings, and allow companies to set up disparate pension plans for favored and less-favored workers. Critics are concerned that the broad bill addresses the wrong problems within the pension system, and is too favorable to employers rather than employees who need pensions to live out their retirement comfortably. One such provision allows employers to contribute less to pension plans, while at the same time improving their balance sheets. Co-sponsor Rep. Ben Cardin (D-Md.) explains that most of the provisions aid employers in an effort to encourage them to retain their defined-benefit pension plans, but critics are concerned that severely underfunded pensions will not do any good for workers.