House bill provides relief for pension funds

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House bill provides relief for pension funds

By JIM ABRAMS
Associated Press Writer


WASHINGTON (AP) -- Companies with pension plans would receive billions of dollars in recession-era relief in a House bill that supporters said could deter employers from freezing those plans or laying off workers.

The legislation, passed by voice vote late Wednesday, also gives a break to some seniors who are required by law to draw down savings from their now-depleted IRA and 401(k) retirement funds.

The Senate is trying to clear the bill, and send it to President George W. Bush for his signature, before the likely adjournment of Congress at the end of this week.

Employers with company-based, or defined benefit pension plans, have been pressing Congress for pension plan relief, saying they are in the untenable situation of needing cash to keep their businesses afloat at the same time they are being required to make large contributions to plans stripped of value by the economic downturn.

The legislation gives hope to plan sponsors at a time that the market has created sudden and dramatically greater pension funding obligations, said American Benefits Council president James A. Klein. Without relief, he said, "money that is needed to save jobs and for capital investment would instead be directed to pension plans."

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