By Leigh Strope
The Associated Press
WASHINGTON - More than 1,000 underfunded pension plans reported a total shortfall of $278.6 billion in 2003, a 9 percent drop from the previous year, based on the latest government filings.
The plans' overall deficit was $305.9 billion the previous year, the Pension Benefit Guaranty Corp. said Thursday.
Airlines and steel companies still are among the industries with the biggest shortfalls. Overall, 1,050 underfunded plans reported $641.8 billion in assets to cover $920.3 billion in retirement benefits and other liabilities, said the Pension Benefit Guaranty Corp.
The 2003 reports were due April 15, but only pension plans that were underfunded by more than $50 million were required to file.
PBGC by law cannot identify the companies sponsoring the underfunded plans.
At the airlines, 11 companies reported a total deficit of $31 billion in plans covering 444,000 participants. In the steel industry, seven companies had a shortfall of $6 billion in plans covering 213,000 participants.
Since PBGC was created in 1974, the airline and steel sectors have accounted for more than 70 percent of the agency's claims, though they have just 5 percent of pension plan participants.
The data is being released earlier than before as part of an overall agency strategy to publicize the funding crisis building in the nation's private pension system. The PBGC also wants changes in laws to let workers and retirees know more about the state of their plans' finances.
"Workers and investors have a right to know the financial status of pension plans," said Executive Director Brad Belt. The information provided to PBGC in the reports "should be publicly available," he said.
The administration and Congress are considering reforms to the system. A pension bill passed by Congress and signed into law by President Bush in April let employer sponsors contribute about $80 billion less to their plans.
The number of underfunded plan filings has shot up from 166 in 1999 to 1,050 in 2003. Shortfalls have risen from $18 billion in 1999 to the $278.6 billion posted last year.
Last month, PBGC reported its own midyear deficit of $9.7 billion, caused by the increasing number of bankrupt pension plans it has taken over.
The agency guarantees payment of a portion of pension benefits earned by about 44 million Americans in 31,000 private pension plans. The agency receives no public funding, and is financed by insurance premiums paid by companies that sponsor pension plans and by PBGC's investment returns.
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