WASHINGTON — The National Integrated Group pension plan will receive more than $887 million from the federal Pension Benefit Guaranty Corporation, guaranteeing benefits for more than 11,300 Michiganians who work in or have retired from manufacturing jobs, including United Auto Workers retirees.
The plan was expected to run out of money in 2034, Biden administration officials said Thursday, forcing retirees to lose 15% of their benefits. The funding will affect 48,254 manufacturing workers who are a part of the Scranton, Pennsylvania-based plan.
"When people work, as the president says, it's not just about a paycheck, it's about your dignity," said Gene Sperling, senior adviser to President Joe Biden. "Being able to retire with dignity, being able to age in place, being able to maintain a decent standard of living is just critical to that overall sense of dignity at work."
The funding is available through the Butch Lewis Act, a bill included in the American Rescue Plan that allows the U.S. Treasury to backfill failing multiemployer pension plans.
The overall program is expected to help more than 2 million workers and retirees and keep more than 200 plans solvent, Sperling said. It includes $80 billion for bailing out struggling pension plans.
The American Rescue Plan was a $1.9 trillion stimulus package in 2021 aimed at easing the economic strain of the coronavirus pandemic. It was passed by Democrats without the support of Republicans in Congress.
Many multi-employer pension plans — created through agreements between multiple companies and a union, typically within the same or related industries — have struggled to remain solvent after being decimated during the Great Recession, said John Shinn, chief financial officer for the United Steelworkers and one of the trustees for the National Integrated Group pension plan.
"This is all about retirement security. They worked hard, through no fault of their own this has been a crisis since the 2008 financial crisis," he said. "These plans will be solid through at least 2051, hopefully longer than that."
