The federal pension insurer expects its multiemployer arm to go bankrupt in 2026, extending by one year a projected collapse that remains unresolved on Capitol Hill.
The Pension Benefit Guaranty Corporation’s latest annual report credits a last-minute reprieve for coal miners rolled into 2019’s end-of-year spending bill with the miniscule improvement, but all signs still point to underfunded multiemployer plans overwhelming PBGC resources in the near future.
The agency released its 10-year projections in September with a near identical outlook. Thursday’s report reflects the state of the pension system now.
“It remains clear that legislative reform is necessary to avert insolvency,” PBGC director Gordon Hartogensis wrote in Thursday’s report.
The multiemployer program closed out the year $63.7 billion in the red, up from the $65.2 billion deficit tabulated for fiscal year 2019. The single employer program continued to grow, registering a $15.5 billion surplus—up from the nearly $9 billion reported a year earlier.
A bicameral supercommittee failed to reach consensus about fixing the underfunding crisis—both for financially distressed union-run plans and the struggling government agency—in 2019. Lawmakers floated some legislative proposals this year, but none gained traction amid the flurry of stimulus talks.
“The pension system is in dire straits and the need for urgent additional legislative reform is critical to prevent insolvency,” the Retirement Security Coalition said in a statement. The group, co-led by former House Speaker John Boehner (R-Ohio) and former Rep. Joe Crowley (D-N.Y.), has been prodding Congress to hammer out a pension funding deal since last summer.