Underfunded Pension Plans: Stronger Funding Rules Needed to Reduce
Federal Government's Growing Exposure (Testimony, 06/15/94,
GAO/T-HEHS-94-191).

Although the majority of pension plans insured by the Pension Benefit
Guaranty Corporation (PBGC) are well funded, a significant minority are
underfunded, and the level of underfunding in these plans has been
growing in recent years. This growth increases PBGC's exposure, which
refers to the size of its potential claims. This testimony makes three
main points. First, current rules designed to ensure that sponsors of
underfunded plans make additional contributions to better fund their
plans are not working well. Second, provisions in the administration's
proposed pension reform bill--S. 1780, the Retirement Protection Act of
1993--especially the revised offset design, should increase both the
number of sponsors of underfunded plans that make additional
contributions and the amount of those contributions. Third, GAO believes
that the proposed funding provisions should be strengthened further to
ensure that an even greater percentage of underfunded plan sponsors make
additional contributions.

--------------------------- Indexing Terms -----------------------------

 REPORTNUM:  T-HEHS-94-191
     TITLE:  Underfunded Pension Plans: Stronger Funding Rules Needed to 
             Reduce Federal Government's Growing Exposure
      DATE:  06/15/94
   SUBJECT:  Financial management
             Pension plan cost control
             Retirement pensions
             Proposed legislation
             Insurance regulation
             Financial institutions
             Insurance premiums
             Employee benefit plans
             Liability (legal)
             Pension claims
IDENTIFIER:  Retirement Protection Act of 1993
             PBGC Single Employer Pension Insurance Program
             
------------------------------------------------------------------------

We regret that electronic text of GAO Testimony is not available at 
this time. 

See the GAO FAQ - Section 2.0 for printed copy ordering information.
The FAQ is automatically retrieved with all WAIS search results or 
can be obtained by sending e-mail to: [email protected]