News & Politics

Report: Private Pension Plans in Danger of Insolvency

We all know the sorry state of public pensions across the country. But now, a report from the Pension Benefit Guaranty Corporation is sounding the alarm about the danger of insolvency for multi-employer pension plans.

The PBGC says that thousands of multi-employer plans are only funded at about 41% of what they should be. This leaves an unfunded liability of more than $600 billion.

Washington Examiner:

The problem is simple: Too many of the plans have not been adequately funded. “While multi-employer plans are typically less well funded than single-employer plans, most multi-employer plans are projected to remain solvent over the next 20 years. However, a core group of plans appears unable to raise contributions sufficiently to avoid insolvency,” the report said.

An estimated 14,000 multi-employer plans cover 10 million people in the U.S. The multi-employer pension system is funded at only 41 percent, which translates to an estimated $610 billion in unfunded liabilities, according to the House Education and the Workforce Committee.