Sens. Rob Portman (R-OH) and Sherrod Brown (D-OH) have introduced a bipartisan bill aimed at giving Ohio workers and retirees a seat at the table when it comes to solving the nation’s looming pension crisis.
As The Ohio Star previously reported, an estimated six million retirees and four million workers in the United States rely on multi-employer pension plans, called “MEPPs” for short, which are collectively bargained plans maintained by more than one employer to limit risk.
A report conduct by Matrix Global Advisors CEO Alex Brill and sponsored by Protect Our Workers’ Earned Retirement (POWER) predicts that the Pension Benefit Guarantee Program—the federal backstop for MEPPs—is itself expected to “be insolvent in less than a decade.”
The Central States Pension Fund, one of the largest MEPPs in the country, will also be insolvent by 2025, according to the report.
“Even after legislative fixes to improve plans’ financial status in 2006 and 2014, one-third of the 10 million participants are in plans that are headed toward either a funding deficiency or insolvency. More than 1 million people are in plans expected to be insolvent within 20 years,” Brill states in his report.
This could have a devastating effect on the economy with a projected loss of more than 55,000 jobs, a drop in $3 billion in labor income, and a drop in GDP of more than $5 billion.
Portman and Brown’s Pension Accountability Act would amend the voting procedures outlined in the 2014 Multi-Employer Pension Reform Act (MPRA), which they say “did virtually nothing to prevent the pending insolvency of the Pension Benefit Guarantee Corporation.”
According to a press release, their bill would make it so that any pension plans seeking cuts would require a “majority vote” from participants in the plan for cuts to occur. Additionally, any non-votes wouldn’t automatically be counted as a “yes” vote.
“I applaud Senators Portman and Brown for introducing this commonsense technical fix to the unfair and undemocratic voting process in MPRA and for making a commitment to work together to develop a broader, comprehensive solution to address the multi-employer crisis that will protect retirees and workers, as well as plans, and the federal pension insurance agency,” Pension Rights Center Director Karen Friedman said.
“Ohio workers have worked hard for years, played by the rules, and paid into their pensions for decades,” Portman said. “As a matter of basic fairness, they deserve a role in determining how to bring these pensions to solvency, and this bill ensures they have a voice in this process.”
Brown said that what “Washington doesn’t understand is that workers sat at the negotiating table and gave up raises because they were counting on these pensions when they retired.”
“It’s common sense that these workers should also have a seat at the table when negotiating the future of the pensions they fought so hard for,” he added. “I’m glad to join Sen. Portman to introduce this legislation and to continue working together to find a comprehensive fix to the pension crisis threatening millions of workers and families across the country.”
– – –