Senate Passes a Bill to Cover Pension Plans
New York Times (01/29/04) ; Walsh, Mary Williams

It is unclear whether the Bush administration will support pension legislation recently approved by the Senate that would have to be reconciled with two similar House measures before it could become law. With the goal of reducing companies' pension burdens, the Senate bill would set in place a new way of calculating pensions for two years, and it would provide companies in certain industries with particular aid. The temporary relief measure would allow companies with severely underfunded pension plans to waive 80 percent of their required catch-up payments for the first year and 60 percent of their catch-up payments for the second year, and it would provide airlines, steel companies, and unions with special pension-financing waivers. While the measure has gained the support of industries struggling with particularly heavy pension burdens, other companies have complained that the measure is unfair. The Bush administration has, in the past, spoken out against providing pension breaks to individual companies or sectors, saying that such aid encourages companies to underfund their pensions. While lawmakers who support the bill say that giving companies pension relief for two years will allow legislators to find overall solutions to current pension problems, critics say the plan will only make problems worse by letting companies cover up their pension shortfalls.

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