Some of the biggest companies in the country are telling Congress to stop using pension plans as a piggy bank to cover other policy plans.
In a letter sent to lawmakers, a large coalition of major businesses and business groups urged Congress to resist imposing more hikes to pension plans, after tapping them to help cover the cost of the recent budget agreement.
The letter was signed by major U.S. companies like General Electric and AT&T, as well as large D.C. groups like the U.S. Chamber of Commerce and the National Association of Manufacturers.
Nearly $12 billion of extra $80 billion in spending included in the two-year budget pact was covered by increasing premiums on pension plans paid to the government-run Pension Benefit Guaranty Corporation (PBGC).
Under the budget, premiums paid by participants in single-employer pensions jumped 25 percent, and underfunded pension plans face steeper premiums as well.
But the business community argues those fee increases effectively amount to a tax on pension providers, and told Congress to stop relying on premium hikes to help pay for unrelated legislation.
“Every additional dollar that employers must pay to the PBGC is one less dollar that can be used to fund participant benefits, expand businesses, create jobs, or grow the economy,” the groups said. “Rather, these premium increases foster economic uncertainty, hamper investment, endanger jobs, and constrain economic growth.”