The American Benefits Council today urged federal lawmakers to move quickly to allow defined benefit pension plans to smooth plan assets and liabilities and ease the transition to full funding requirements of the Pension Protection Act of 2006.
The relief is required because the PPAs tougher funding regulations are kicking in just as major stock market losses are hammering plan assets, ABC executives said at a news briefing in Washington.
If Congress fails to act, employers will be compelled by law to restrict benefits and compelled by circumstances to freeze pension plans to mitigate the impact of market conditions, James Klein, ABC president, said in a news release. Employers should not be forced to make unexpected contributions based on short-term unprecedented market volatility.
Also at the briefing, ABC executives said they want legislation passed this year that will include the smoothing provisions to allow pension plan executives to make budgeting decisions about their plans for next year.