Legislation that would change the formula for required annual pension contributions, saving employers nearly $100 billion over the next two years, is awaiting Senate passage. If employers are forced to determine payments based on the 30-year Treasury bond rate the costs of funding pension contributions will rise steeply. Under the new legislation the formula would be based on a composite of investment-grade corporate bonds, allowing companies to save about $80 billion over two years. The legislation is supported by business groups and unions, who fear that some companies will eliminate their plans or declare bankruptcy if some changes to the pension system are not made.
See "Employers could save billions with pension relief bill before Senate", USA Today, January 27, 2004