USA: Congress serves companies a pension break
Employers and union officials have credited the United States Congress with helping to save American jobs with its approval of a bill to give companies a massive break on pension contributions.
Reuters said the Senate approved the bill that is expected to save some 31,000 US companies with traditional "defined benefit" pension plans about $US80 billion over two years by replacing a formula for calculating pension contributions - such plans cover about 35 million workers.
The news agency noted that many traditional pension plans are under-funded and companies are struggling to keep up with the payments but the aid is intended as a temporary measure to help keep plans afloat while Congress works on longer-term pension reform.
Officials from industries such as motor vehicles, airlines and steel applauded the vote, which sends the bill to president George W. Bush for his signature, Reuters said.
"It's the right thing to do," DaimlerChrysler spokesman Staurt Schorr told the news agency, adding that its pension is adequately funded at the moment.
Reuters said DaimlerChrysler, along with General Motors and Ford, had urged senators in a letter to pass the measure, noting it also had the support of the United Auto Workers union.
The report said the measure had already passed the US House of Representatives, and supporters were anxious to get it to the president's desk in time to give a break to companies that have to make quarterly pension payments on April 15.
According to Reuters, Mark Ugoretz, president of the ERISA (News - Websites) Industry Committee, said: "Congress has taken an enormous step in saving the US private pension system." ERISA member companies provide retirement, health care coverage and other economic benefits to some 25 million active and retired workers.
However, critics reportedly said it did not go far enough, deleting most of the aid to plans sponsored by more than one employer, which cover mostly unionised workers in industries like trucking and construction.