ABI poll participants feel practice of shedding pension plans onto PBGC abuses bankruptcy system

By Caroline Salls

Pittsburgh, June 22 - An American Bankruptcy Institute (ABI) online poll showed 63% of respondents agreed that the practice of corporate debtors shedding their defined benefit pension plans onto the Pension Benefit Guaranty Corp. is an abuse of the bankruptcy system, according to a news release.

ABI said the poll question was based on reports that the PBGC is operating under a $22.8 billion deficit after assuming the liabilities of pension plans of recently bankrupt companies in the airline, automotive and steel industries.

Of the majority of respondents, 52% strongly agreed and 11% somewhat agreed that corporate debtors transferring defined benefit pension plans onto the PBGC is an abuse of the bankruptcy system.

Conversely, 19% of respondents disagreed strongly and another 10% disagreed somewhat that the practice is an abuse of the bankruptcy system.

A total of 8% of the respondents did not know or had no opinion on the issue.

According to the release, more than 100 people participated in this latest ABI Quick Poll from June 16 to June 22.

ABI is an Alexandria, Va.-based multi-disciplinary, nonpartisan organization dedicated to research and education on matters related to insolvency.

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