11.28.05

Cantwell Calls on President Bush to Support Vital Pension Protections

Senator joins pilots, flight attendants at SeaTac Airport to underscore need for increased pension security

SEATAC, WA – On Monday, U.S. Senator Maria Cantwell (D-WA) joined current and retired airline employees at SeaTac International Airport to call on President Bush to support meaningful pension reform legislation. The Pension Security and Transparency Act, passed by the Senate earlier this month with Cantwell’s support, would protect pensions and encourage companies to live up to their pension funding obligations.

"Current pension system rules just don’t work," said Cantwell. "Workers ought to be able to count on the retirement benefits their employers promised. Cutting pensions is not an option. We need to fix the rules."

At SeaTac, Cantwell joined local airline employees for a roundtable discussion of the airline provisions included in the recent Senate-passed pension reform bill. The Senate bill rewrites pension rules to better help companies with defined-benefits plans make good on their obligations. Unlike the House bill or the Bush Administration’s proposal, the Senate bill has two measures that are targeted at the airline industry. The first would extend from 14 to 20 years the time allowed for airlines to stabilize their pension plans, and would expand the number of airlines that qualify for pension payment relief. This will give airlines a longer timeframe for funding their pension plans, and is one way to dissuade companies from terminating pensions. The second provision contained in the bill protects the pensions of airline pilots, who are required to retire at age 60 but currently have their pensions calculated assuming a retirement age of 65.

"Airline workers, like workers at so many other companies, have worked with pride for decades to make their companies successful," said Cantwell. "This pensions bill will help airlines keep their promises to their employees and will help airlines provide the stable retirements workers were promised."

The House is scheduled to take up a version of the pension bill early in December that does not contain provisions that would provide targeted funding relief for airlines, and does not do enough to force companies to fully fund their pension plans. The White House has threatened to veto pension legislation that has industry specific protections, including any specific provisions pertaining to airline pensions. In letters to President Bush and House leaders, Cantwell urged support for the Senate pension reform bill to strengthen the pension system’s funding rules and help industries like the airlines keep their pension promises to millions workers.

[The text of Cantwell’s letter to President Bush follows below]

November 28, 2005

Dear Mr. President,

I want to thank the Administration for supporting the Senate passage of the Pension Security and Transparency Act of 2005 (S. 1783). This legislation takes a major step to providing comprehensive pension reform and ensuring workers receive the pensions they were promised.

As you know, the Senate Pension Reform Bill (S. 1783) included two amendments that would extend relief to the airline industry. One provision would make retirement law consistent with regulations of the Federal Aviation Administration by lowering the age of retirement to 60 so that pilots can receive maximum pension benefits from the Pension Benefit Guaranty Corporation (PBGC). The Senate also accepted an amendment to the pension reform bill that would extend from 14 to 20 years the time allowed for airlines to stabilize their pension plans. Both of these additions to the legislation are crucial to the fiscal health of the airline industry and for the solvency of the PBGC.

Several thousand airline pilots and employees reside in my home state of Washington. Northwest Airlines currently has nearly 4,000 pension plan participants in Washington State. If Congress does not pass a comprehensive pension reform bill, over 300,000 employees and retirees from a variety of airlines nationwide could see their pension benefits reduced or eliminated altogether. Cutting pensions are simply not an option.

Despite bipartisan support for S. 1783, it is my understanding that the Administration is considering vetoing any pension bill with industry-specific protections, such as the airline provisions. I urge the Administration to reconsider their decision and support passing a pension reform bill, like the Senate version that strengthens the funding rules of our pension system and helps industries like the airlines keep their pension promises to millions of workers.

Sincerely,

Maria Cantwell