Taken from the Tribune

Pension warning issued
U.S. agency reports $22.8 billion deficit

By Barbara Rose
Tribune staff reporter
Published November 16, 2005

While lawmakers continued to grapple with pension reform, the federal agency that insures private pensions reported a $22.8 billion long-term deficit Tuesday and warned that the money to pay benefits eventually will run out.

The Pension Benefit Guaranty Corp.'s shortfall was slightly smaller than last year's $23.3 billion, thanks to better investment results and other factors. But the agency's exposure to losses from bankrupt and financially struggling companies in the airline and automotive industries looms larger than ever.

The agency estimated its "reasonably possible" future exposure at $108 billion, up 12 percent from last year's estimated $96 billion. It does not disclose which companies are included in the estimates.

"Unfortunately, the financial health of the PBGC is not improving," the agency's executive director, Bradley Belt, said in a statement. "The money available to pay benefits is eventually going to run out unless Congress enacts comprehensive pension reform to get plans better funded and provide the insurance program with additional dollars."