A federal judge has ruled that General Motors can seek as much as $US253 million in pension costs from the United States federal government, the Associated Press (AP) reported.
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Judge Nancy Firestone of the US Court of Federal Claims reportedly ruled on June 28 that GM can seek payments from the federal government for a pension plan that was under-funded when it sold its Allison gas turbine division in 1993 – GM provided services to the government through Allison.
AP said that GM has been seeking the payments since 1996 under federal cost accounting standards that allow recovery for federal contractors’ pension costs – GM sued in 2000 after contract negotiations broke down.
The news agency noted that, in her decision, Firestone didn’t specify how much the government owes, although she did say GM isn’t allowed to make a profit in the case.
Firestone reportedly said it’s impossible for her to determine how much GM should be reimbursed since GM has been making contributions to its pension fund since the case was filed.
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By GlobalData“Final resolution of this case is therefore premature,” Firestone said, according to the Associated Press, which added that the government is expected to appeal.
