Pension Rights Center Questions Pension Buy-Outs

Congress should impose moratorium until policymakers consider risks to plan participants, center says.

The Pension Rights Center, a consumer organization that promotes retirement security, says that it will ask Congress to call a halt to companies’ pension buyouts until policymakers can examine whether such transactions pose risks to employees and retired workers.

The center’s call for a moratorium follows Verizon’s announcement earlier this week that it had transferred $7.5 billion of its pension obligations, covering about 41,000 retirees, to Prudential Financial, which will take over making the pension payments. A number of other companies, including General Motors and Ford, have announced plans this year to move pension obligations, and risk, off their balance sheets by offering plan participants lump sums.

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