Fri, Aug 04, 2006
NWA Says Bill Gives Time To Save Pensions
So much for the opposition. CFO.com
reports that by a somewhat lopsided vote of 95-5, the Senate late
Thursday night passed the Pension Protection Act -- a
pension reform bill aimed at making it easier for cash-strapped
airlines to repay their pension funds.
Supporters of the bill -- which now goes to President Bush for
approval -- say the new legislation bolsters existing pension
funding rules, by requiring companies to repay their pension
obligations within seven years. Detractors of the bill maintained
the legislation favors airlines that have chosen to freeze their
pension funds, by giving those entities a total of 17 years to make
good on the funds.
One airline seen as benefiting from the bill, Northwest
Airlines, expressed its gratitude shortly after the bill was
passed.
"On behalf of the 73,000 participants in Northwest Airlines'
pension plans, and the families that depend on them, we thank all
of the members of the House and the Senate that supported this
important legislation," said Northwest President and CEO Doug
Steenland to Aero-News. "While there have been many people involved
in this effort, Northwest and its employees would like to
especially thank the broad, bi-partisan coalition [from]
legislators."
Along with Continental Airlines and similarly troubled Delta Air
Lines, Northwest has negotiated pension plan freezes with its
unions, which would also freeze the liability for the Pension
Benefit Guaranty Corporation (PBGC) -- thus giving the airline more
time to repay the funds currently obligated.
"With employees making the difficult decision and sacrifice to
freeze their pension plans, all of us looked to Congress for the
additional time required to save our plans," said Andrea Fischer
Newman, senior vice president of government affairs. "Tonight, the
legislative branch of our government has spoken and protected
airline employees' retirement benefits and U.S. taxpayers."
The pension bill was the last piece of legislation passed by the
Senate before lawmakers left for a month-long recess.
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