WASHINGTON – The chief of the financially strapped federal agency that protects private pensions for millions of workers and retirees announced Thursday that he will step down at the end of May.
Bradley Belt, who has served as the executive director of the Pension Benefit Guaranty Corp. for two years, revealed his intentions to leave in a resignation letter to President Bush.
"This past two years has been a particularly tumultuous period for the PBGC, which has had to confront unprecedented operational, financial and policy challenges," Belt wrote in his resignation letter. He did not provide a reason for his planned departure on May 31 or say what hopes to do after he leaves the agency.
The PBGC, which insures defined-benefit plans, has reported a deficit of $22.8 billion. Bankrupt steel and airline companies that have transferred pension responsibilities to the PBGC have been a major factor in the agency's swollen debt.
PBGC's operations are financed by insurance premiums paid by companies that sponsor traditional pension plans. It also earns money from investments and receives funds from pension plans it takes over. The agency is not funded through tax revenues.
Analysts and others, however, fear that if Congress doesn't take steps to shore up the nation's troubled private pension system there could be the risk of a future taxpayer-financed bailout.
Defined-benefits plans are now underfunded by an estimated $450 billion. To fix this, legislation would tighten pension-funding rules for companies. The bills also aim to financially shore up the PBGC.
Both the House and Senate have passed legislation, but differences need to be ironed out. The goal is to send a final bill to the president by April 15.