Pension Shortfalls at U.S. Firms Double [View All]

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http://story.news.yahoo.com/news?tmpl=story&ncid=716&e=15&u=/nm/20030904/bs_nm/congress_pensions_dc

WASHINGTON (Reuters) - Pension underfunding at "troubled" U.S. companies has doubled this fiscal year and could exceed $80 billion, with airlines accounting for nearly a third of the shortfall, the government said on Thursday.

The Pension Benefit Guaranty Corp., which bails out corporate retirement plans, told Congress its own deficit grew to a record $5.7 billion as of July 31, $2 billion higher than the shortfall for all of fiscal 2002.

PBGC Executive Director Steven Kandarian called for reforms to pension rules, telling the House Education and the Workforce Committee that the cost of current pension problems would otherwise have to be met through reduced benefits, higher premium payments by companies to the agency or a taxpayer bailout.

Underfunding at "troubled" companies -- defined as those whose debt is rated below investment grade or are otherwise at risk -- could exceed $80 billion by the time the current fiscal year ends Sept. 30, Kandarian said, up from $35 billion last year.

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