The NCCMP is the only national organization devoted exclusively to protecting the interests of the millions of active and retired American workers and their families who rely on multiemployer pension and annuity plans for these retirement benefits. We proactively engage Congress, the Administration, the various regulatory agencies, and the Courts—to advocate for the interests of multiemployer plans and participants. Our work is critical to protecting pension benefits for the 10.4 million American pension plan participants, as well as to fostering an environment that allows multiemployer pension plans to succeed and grow stronger.
Retirement income security is an issue of increasing importance in the United States. Over the past four decades, we have fought to protect and strengthen multiemployer pension plans in order to preserve this valuable source of lifetime income. Below are the issues that are priorities for multiemployer retirement plans and participants.
The Joint Select Committee on Solvency of Multiemployer Pension Plans was formed in February 2018 to address the impending insolvency of a small subset of multiemployer pension plans, as well as projected insolvency of the Pension Benefit Guaranty Corporation’s Multiemployer Fund. However, their focus expanded considerably to include issues affecting all multiemployer pension plans.
Ultimately, the Joint Select Committee dissolved at the end of 2018 without issuing a report or legislation. But multiemployer pension reform, including issues such as funding that affect all plans, remains a top focus of Congress in 2019. We need to ensure that Congress is able to provide meaningful tools to the plans currently facing insolvency, while not imposing additional cost or risk to the healthy plans that are currently succeeding in their mission to provide secure and reliable lifetime income to their participants, and providing Trustees of healthy plans with a new retirement security option in the form of the GROW Act.
We need to pass Composite Plan legislation in order to provide plan sponsors with the legal framework for a new voluntary plan design that fully funds the legacy defined benefit plan, while creating a new type of plan going forward that incorporates the best features of both defined benefit and defined contribution plans.
We need to ensure that the Kline-Miller Multiemployer Pension Reform Act of 2014 (MPRA) is a real tool that is available for trustees to use to restore troubled plans to solvency and protect beneficiaries from the even larger benefit reductions that will experience when their plan becomes insolvent and subject to the PBGC guarantee level.
We need the PBGC to be a credible insurer that can honor its commitments, but to do so in a way that sets premiums at a level that is affordable and consistent with the value of the insurance provided, and that does not destroy the viability of multiemployer plans. When faithfully implemented, MPRA’s tools would significantly reduce the PBGC’s net deficit, and therefore the need for additional PBGC premiums.
We must achieve a legislative solution for the solvency problems of Central States and other pension plans in similar situations, where MPRA is not going to be a viable option. This is an integral part of reducing the PBGC’s net deficit which also impacts the need for additional PBGC premiums.
The Multiemployer Pension Reform Act of 2014 (MPRA) reflects the Preservation and Remediation proposals from the Retirement Security Review Commission’s Solutions Not Bailouts report. The Preservation proposals included technical corrections to the Pension Protection act of 2006, designed to strengthen the current system. The Remediation proposals included new, voluntary tools to allow Trustees of deeply troubled multiemployer plans to restore their plans to solvency and preserve benefits for their participants at a level above the modest statutory guarantee. The NCCMP was instrumental in the passage of MPRA.
The Retirement Security Review Commission brought together dozens of representatives from more than forty labor and employer organizations, plans and large employers from across the multiemployer universe that utilize multiemployer defined benefit pension plans as their primary form of retirement security. The Commission worked for nearly 18 months to develop a complete set of reforms for the multiemployer system. The group sought the opinions of experts from a variety of disciplines, including economists, public pension policy experts, investment firms, investment consultants, actuaries, and experts in alternative plan designs, operations and the statutory and regulatory environments that govern similarly structured plans in Europe and Canada. The Commission presented the results of its work in a comprehensive report entitled Solutions Not Bailouts.
Throughout the pension reform process that resulted in the Pension Protection Act of 2006 (PPA), the NCCMP advocated tirelessly for the preservation of the multiemployer pension system. We worked to educate Congress and the Administration on the unique nature of multiemployer pension plans, and the differences between the multiemployer and single employer systems. Those efforts preserved, in large part, the funding rules for multiemployer plans that reflected the distinct, long-term nature of multiemployer pension obligations.