Business groups opposed to an Obama administration proposal to allow the PBGC to set its own premiums are enlisting members of Congress to keep it separate from current budget deficit talks and table it until closer scrutiny of the PBGC can be made.
In a letter to all congressional members Monday, the U.S. Chamber of Congress, the ERISA Industry Committee and other employer groups argue that allowing the Pension Benefit Guaranty Corp. to raise premiums “amounts to a tax on employers that have voluntarily decided to maintain defined benefit plans.”
The groups’ letter says changes “of the type and magnitude being discussed” would undermine the defined benefit system and hinder economic recovery efforts. They plan to fight to keep premium increases out of budget talks.
The budget proposal would raise as much as $16 billion in premiums over 10 years by shifting authority from Congress to the PBGC, which would set the premiums based on the financial health of the sponsor or plan.
“Since there is no immediate crisis, Congress should not relinquish its authority” and instead should first examine the PBGC’s financial situation, the groups argued in the letter.