Chamber Commends Senate for Final Action on Pension Fix

WASHINGTON, D.C. – The United States Chamber of Commerce welcomed today's Senate vote on the pension conference report, which replaces the obsolete 30-year Treasury bond rate with a new benchmark for corporate contributions, and urged President Bush to sign the much-needed legislation.

"President Bush's signature on this bill will allow companies to put more money into new business investments – creating new jobs and new opportunities," said Bruce Josten, Chamber executive vice president. "Putting more corporate funds behind the economic recovery already underway – instead of making excessive pension contributions – is a win-win for workers and the economy."

The Pension Benefit Guarantee Corporation had estimated companies were facing
$80 billion in inflated pension contributions over the next two years, because those contributions were based on an obsolete benchmark system.

Without Senate passage, and final action by the president, U.S. companies would have had to start making inflated contributions to their plans next week, according to the Chamber. Two separate consulting firms had found that 20-39% of employers had either frozen or were planning to freeze their plans, absent a fix.

"Employers voluntarily provide tens of millions of American workers with pension benefits," said Josten. "We are pleased that lawmakers have recognized the need to act to protect this important worker benefit."

Previously, corporate pension contributions were calculated using the 30-year federal Treasury bill rate. When the 30-year T-bill was discontinued, Congress enacted a temporary fix that expired in December 2003.

The U.S. Chamber of Commerce is the world's largest business federation representing more than three million businesses and organizations of every size, sector and region.

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