A package of reform proposals to help the most troubled multiemployer pension funds is running into more opposition from some union and retiree advocates.
At a hearing held Tuesday by the House Education and the Workforce Subcommittee on Health, Employment, Labor and Pensions to consider possible legislation, members of the Retirement Security Review Commission discussed their reform proposals, which would allow for reduced benefits for future and possibly current retirees in the most troubled pension funds.
Those cuts are now opposed by the 37 million-member AARP, International Brotherhood of Teamsters, Pension Rights Center and $8.4 billion IAM National Pension Fund, Washington.
“There is a battle brewing in the halls of Congress,” said R. Thomas Buffenbarger, president of the International Association of Machinists and Aerospace Workers, after the hearing.
However, Randy DeFrehn, executive director of the National Coordinating Committee for Multiemployer Plans, which convened employers and labor unions as the Retirement Security Review Commission in order to come up with legislative fixes for all plans and remediation measures for the most troubled plans, told Pensions & Investments that despite the protests, “legislation is in the works.”
While the legislative solutions “will be painful,” said subcommittee Chairman Rep. Phil Roe, R-Tenn., “I believe we have a commitment on both sides now to do something.”
“At this point, I think we need to deal with reality,” Thomas Nyhan, executive director and general counsel of the severely underfunded $16.5 billion Central States, Southeast & Southwest Areas Pension Fund, Rosemont, Ill., told committee members. “The longer we wait, the deeper the cuts will have to be.” The Central States pension fund was 53.9% funded as of Dec. 31.