(US) Pension agency to go to court vs Delphi, GM: report

[UpInArms]

Source: Reuters

(Reuters) - The U.S. government's pension insurance agency has told bankrupt auto parts maker Delphi Corp (DPHIQ.PK) it would go to court on Friday to secure a claim on an additional $900 million in Delphi assets, The Wall Street Journal said.

The move comes after Delphi missed payments of several hundred million dollars to its pension plan in June and July. The new claims involve Delphi's foreign operations, which are believed to be profitable.

On Tuesday, the Pension Benefit Guaranty Corp (PBGC) sent its second letter to executives of Delphi and former parent General Motors Corp (GM.N) urging GM to absorb at least $1.5 billion in Delphi pension obligations before September 30.

According to the PBGC, the September 30 deadline is important as after that a new pension law will take effect and will make a deal much more costly.

The first letter was sent in mid August but PBGC felt GM and Delphi were dragging the process by missing some previous dates to complete a transfer of pension obligations.

Read more: http://news.yahoo.com/s/nm/20080911/bs_nm/delphi_pension_dc?_ylt=AoQH0RATa5t69gwli5WPkBiyBhIF

[doc03]

1. My pension was dumped on the PBGC several years ago

and 18 months from now I will be eligible to start receiving my benefits. Every few days I read about another company dumping their pension on the PBGC and the PBGC was running an $18 billion deficit the last I heard. I just wonder if the pension I earned will be cut or even exist 18 months from now. A couple years back it was suggested that the Government should bail them out and Bush said a lot of taxpayers don't even get a pension so why should the taxpayers be obligated to bail them out. The PBGC is similar to the FDIC it is an insurance program backed by the US Government. I am scared if the PBGC defaults while a Repug is in office it won't be backed by the government as promised. GM has the money and they made an agreement with the UAW to provide these pensions and shouldn't be forgiven for one cent of their obligation.

[bean fidhleir]

2. Top management should be made personally liable if the corporation doesn't come through

But capitalism doesn't work that way, of course. The ones who screw things up are always able to walk away laughing.