Senate panel advances overhaul bill

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Wednesday, July 27, 2005 | 9:38 a.m.

WASHINGTON -- Legislation setting rules for companies that prefer to set aside money each year for their employees' retirement instead of promising workers a specific monthly pension benefit won approval Tuesday from the Senate Finance Committee.

The panel folded the guidelines into a bill that would overhaul the rules governing private pension plans and buttress the federal agency that insures worker pensions, the Pension Benefit Guaranty Corporation.

Worried that more companies may choose to dump their troubled pension plans on the financially strapped federal insurance system -- as United Airlines recently did -- the panel wrote special rules to help airlines cope with their underfunded pensions.

It would give the airlines 14 years to catch up, a change that lawmakers hope will ease the pressure on the PBGC and a record deficit topping $20 billion.