Actuarial group offers pension overhaul guidelines

American Academy of Actuaries outlined several principles to guide an overhaul of pension funding rules. The Washington-based professional group noted that any change in rules should ensure that plan sponsors' contributions are predictable so they can be budgeted in advance. They also suggested the funding rules should: accommodate plans with risk hedging strategies such as immunized bond portfolios, which would make their contributions more predictable; allow companies to make additional contributions in good economic times to offset lower contributions in slow economic conditions; make all new rules easier to use and understand than the current set; give plan sponsors time to make the transition to the new rules; and avoid supporting financially weak employers at the expense of the system, taxpayers and financially strong companies.