Multiemployer pensions’ transition to reform should ensure solvency and not be rushed

Nov. 29, 2018, Fairfax, Va.—Americans for Limited Government President Rick Manning today issued the following statement urging the Joint Select Committee on Solvency of Multiemployer Plans to use the opportunity to reform multiemployer pensions but in a way that allows the plans to transition over time to the new system:

“The joint committee has a special opportunity to reform distressed multiemployer pensions. Any deal must have union skin the game on any risk pool created. Full transparency including external audits for all affected multiemployer pension plans should be included, and there must be a way for companies to exit and decertify the union by replacing the lump sum payment. Ideally, legislation will transition distressed multiemployer pension plans to a defined contribution model.

“Additionally, when considering appropriate interest rate assumptions for these multiemployer plans, the committee should develop transition rules that permit the plans to properly adjust to the new realities overtime.  There is no need to rush, and the medicine, while necessary, should be administered over a period of time so that it doesn’t kill the patient.”

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