Workers ‘Face Retirement With Fear’ As GOP ‘Refuses To Back’ Pension Protection Bill
(WASHINGTON, D.C.) - Glen Heck spent 28 years sweating in a Campti, Louisiana Paper Mill that he likes to say was “hotter than nine kinds of hell.” But now, Heck’s sacrifice may have been for nothing because his Multi-Employer Pension Plan is one of about 150 nationwide set to go broke. If that happens, the 78-year-old Heck will have to find a cheaper, lower-quality health plan and keep the beef herd he’s itching to sell.
The Democratic-controlled House passed - with bipartisan support - a common sense plan to save Heck’s pension and those of another 1.3 million Workers, retirees and widows, but Republican leaders in the Senate refuse to consider it.
In the meantime, the future of Workers and retirees like Heck hang in the balance.
Many face retirement with fear instead of anticipation.
Multi-Employer Pension Plans like Heck’s include Workers from two or more companies in industries such as transportation, entertainment, construction and paper.
Heck and others often give up wage increases or other benefits to fund those plans.
Many of the 1,400 plans nationwide are still healthy, but through no fault of Workers or retirees, about 150 are struggling.
Recessions in 2001 and 2008 cut the plans’ investment earnings and some corporations used bankruptcies to evade pension obligations.
Deregulation forced less-competitive companies out of business, straining the plans’ resources.
Now, they owe more money to beneficiaries than they have coming in and they’re at risk of collapsing.
The PACE Industry Union-Management Pension Fund (PIUMPF) - Heck’s plan - is one of them.
According to recent projections, the fund will be insolvent in as few as 10 years.
Under the Bill passed by the House, the Butch Lewis Act, the Treasury Department would loan money to troubled plans.
The plans would use the money to meet their obligations to retirees and they would repay the loans over 30 years.
The Federal Government already has an agency, the Pension Benefit Guaranty Corporation (PBGC) to pay benefits to retirees when Multi-Employer Plans crumble, but it’s no substitute for the Butch Lewis Act.
Also, so many plans are imperiled that the PBGC’s Insurance Program itself is at risk of collapse.
If plans fail, Workers and retirees will lose as much as 98% of their benefits.
The Butch Lewis Act would ensure they receive the money they earned, not pennies on the dollar.
Heck, a former officer with United Steelworkers (USW) Local 13-1331 in Campti, knows widows of Paper Workers - one with a small child - who’d be financially devastated without their late husbands’ pensions.
He knows a retiree with major health problems who’d have no way of paying medical bills without his pension checks.
“He’s ‘just worried to death about it,’” said Heck, who worked at the paper mill under a handful of operators, including current owner International Paper.
Cedric McClinton, the President of Local 13-1331 and a Technician at the paper mill, said pensions are the main source of retirement income for many Workers and retirees.
If those benefits get cut, there’s no easy way to make up the difference.
“You’re ‘either looking at working longer and who wants to work until you’ve got one foot in the grave and the other on a banana peel or you’re looking at making concessions after you’ve worked all that time,’” McClinton said.
Workers worry about downsizing their homes, giving up travel plans and going on Government Assistance Programs.
“We ‘talk about these things all the time,’” McClinton said. “It’s ‘real.’”
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