PBGC: Multiemployer insolvency still targeted for 2025
Single-employer program expected to reach a surplus by 2022
By Meaghan Kilroy
August 3, 2017 3:45 pm - Pensions & Investments
The PBGC's multiemployer pension plan program is likely to
face insolvency by the end of 2025, while the single-employer program could
eliminate its deficit by 2022, said the agency's fiscal 2016 projections report
released Thursday.
The annual projections report provides a range of estimates of the future
status of insured pension plans and their effect on the Pension Benefit Guaranty
Corp.'s financial condition, based on hundreds of different economic
scenarios.
Absent any changes in law or additional resources, the multiemployer
program's fiscal year 2016 deficit of $59 billion is projected to grow in
nominal terms to nearly $80 billion in fiscal year 2026, Thursday's report
said
On the flip side, the single-employer program's fiscal condition is expected
to improve over the next 10 years with its fiscal year 2016 deficit of $21
billion likely to reach a surplus by the end of fiscal year 2022 and a surplus
of $9.6 billion in fiscal year 2026, an increase of $7 billion from last year's
projections report.
A PBGC news release on Thursday's report notes that President Donald Trump's
fiscal 2018 budget, which proposes a new variable rate premium and exit premium
for the multiemployer program, could raise an additional $16 billion in premium
revenue over the budget's 10-year window.