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Bark with no bite? House voices opposition to PBGC/UAL pension deal
By Ted A. Knutson
Washington, June 24 - The House of Representatives voted 219 to 185 (31 Republicans, 185 Democrats and one independent) Friday to prohibit the Pension Benefit Guarantee Corp. from using funds appropriated by Congress to take over the United Airlines defined benefit pension plans.
The catch is the PBGC doesn't get Congressional appropriations. The agency receives its funds from premiums paid by the pension plan sponsors.
"We're studying the measure for its impact," a PBGC spokesperson said.
A statement from United parent UAL Corp. said the measure, an amendment to the Health and Human Services Fiscal 2006 appropriations bill which passed in its entirety, would not have an immediate affect on the airline.
"Our agreement with the PBGC enabling the agency to assume our defined benefit pension plans is, as both the PBGC and the bankruptcy court have agreed, necessary - a fact that no legislation can change," said the airline.
The Air Line Pilots Association, the union for United's flight crews, said it is still looking at whether the amendment would have any practical implications.
However ALPA's chief elected United official, captain Mark Bathurst, said the measure potentially would be good for the long-term well-being of the airline's employees.
The amendment was sponsored by Rep. George Miller, D-Calif., the ranking Democrat on the House Committee on Education and the Workforce.
A spokesperson for Sen. Edward Kennedy, D-Mass., said the senator is looking for a mechanism to stop the agreement by the PBGC and UAL to take over the United plans.
Miller and Kennedy are co-sponsoring the Pension Fairness and Full Disclosure Act, which would prohibit companies that have underfunded employee pension plans from increasing executive compensation.
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