FOR IMMEDIATE RELEASE
For Information Contact:
A. J. (Jim) Norby Bill Kadereit Ed Beltram
218-863-8116 218-725-5289 719-687-6157
Retirees Network Applauds Passage Of Pension Reform Legislation
Group’s Attention Now Shifts to Health Care Reform
(WASHINGTON, Aug. 10, 2006) – Passage of the Pension Protection Act of 2006 by Congress was applauded as a “major accomplishment” for older Americans by A. J. “Jim” Norby, president of the National Retiree Legislative Network (NRLN).
“The NRLN has always supported the basic thrust of this legislation, which substantially tightens pension plan funding requirements and greatly reduces the risk of plans defaulting to the Pension Benefit Guaranty Corporation (PBGC),” Norby noted. “Calculations of plan liabilities, asset values and the level at which plans must be funded have all become far safer for retirees.”
Norby credits NRLN’s Grass Roots Organization members for their effort to convince congressional members and their staffs of the need to tighten corporate pension funding rules and close the loopholes that have enabled companies to accumulate huge pension liabilities. “Our Grass Roots network members have e-mailed nearly 40,000 letters to elected representatives through our Capwiz Web site and made countless personal calls and visits to their congressional delegates in support of this legislation,” according to Norby.
Key provisions supported by the NRLN and its member associations include:
· A requirement that companies fund 100 percent (instead of 90 percent) of their pension plan liabilities within seven years.
· Reduction of the asset smoothing rule from five years to two years.
· Protection against “wearaway” for future cash balance conversions and rejection of efforts to retroactively legalize cash balance conversions, which would have negated lawsuits by retirees in several NRLN associations.
· Rejection of a provision to lower the threshold level for companies to transfer dollars out of their pension plans from 125 percent to 115 percent. A threshold of 120 percent was adopted, representing a victory for retirees since the calculation of pension liability is more conservative under the new law which could mean a higher threshold than under the current law.
· Stronger disclosure and reporting requirements for pension trust funds.
Norby acknowledged concern over “transition rules” that address conversion of defined benefit pension plans to cash balance plans. “These rules could have been much improved and better defined, but I’m convinced had it not been for the constant pressure exerted by the NRLN and its Grass Roots Network members this legislation would have been much less favorable to workers and retirees,” Norby asserted. “In fact, the bill probably would not have been passed at all.”
The NRLN will now shift its attention and resources to passage of health care reforms, such as the Emergency Retiree Health Benefits Protection Act (HR 1322) or similar legislation that will protect health care coverage for Americans at a reasonable cost. “Under this bill, employers would be prohibited from making post-retirement cancellations or reductions of health benefits that retirees were promised,” Norby added.
Specific issues that are being addressed include:
· The Pharmaceutical Market Access and Drug Safety Act which would permit U.S. consumers to buy safe prescription drugs from Canada and other countries. That bill was introduced by Sen. Byron Dorgan (D-N.D.) with bipartisan support from several senators including Olympia Snowe (R-Maine), Chuck Grassley (R-Iowa), John McCain (R-Ariz.), Edward Kennedy (D-Mass.) and others.
· Competitive bidding for prescription drugs (Medicare Part D).
· Acceleration of generic drug approvals.
· House of Representatives legislation (HR4685) that prevents interruption of coverage by private plans during the plan year and establishes an appeal process.
· House and Senate legislation that suspends late filing fees for Medicare Part D.
· Legislation that would permit corporations to accumulate advance funding reserves for retiree medical benefits.
Based in Washington, D.C., NRLN is dedicated to securing federal legislation that will guarantee the fair and equitable treatment of retirees in private and public sector health and pension programs. NRLN represents a non-partisan, grass roots coalition of retiree associations with a combined membership of more than 2 million men and women who are seeking to protect their pension and health care benefits. For more information, visit the NRLN Web site at www.nrln.org.
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