Delphi salaried retirees are seeing retirement payments from the Pension Benefit Guaranty Corp. change in an unexpected way.
Starting June 1, some salaried retirees have begun to receive two pension payments a month instead of one. A second payment is coming from Prudential Insurance Co. of America, based on an annuity General Motors purchased years ago with retirement contributions paid by workers. The annuity reflects those contributions.
Added together, the two monthly payments should equal what the salaried retirees have been receiving all along, the PBGC told retirees in an April 30 letter. For example, if a retiree was receiving $1,500 monthly, he or she may now be paid $1,300 from the PBGC and $200 from Prudential.
But the change has some retirees scratching their heads. Why are they receiving payments from the annuity in mid-2013, nearly four years after a then-bankrupt Delphi relinquished its pension obligations to the PBGC, some retirees are asking. And have the workers’ contributions increased in value in that time?
Den Black — a Piqua native who often speaks for a group of Delphi non-union retirees called the Delphi Salaried Retirees Association (DSRA) — said retirees are asking the PBGC several questions, including, “We’d like you to explain how you calculated this.”
“This is completely out of the blue after three-and-a-half years,” Black said.
Some 20,000 salaried retirees saw their pensions reduced when the PBGC took them over in 2009. The agency has said that federal law caps how much it may pay retirees whose pensions it controls. The DSRA is suing the PBGC in Detroit’s federal court to restore their full pensions.
And retirees say PBGC responses are doing nothing to dispel confusion.
“They should have split it out (the payments) from the very, very beginning,” said Tom Rose, a Washington Twp. Delphi retiree who saw his pension cut by 40 percent when the PBGC took it over.
A PBGC spokesman asked that questions be emailed to him.
Earlier this week, a U.S. House of Representatives panel held a field hearing at Sinclair Community College to explore the salaried retirees’ plight. The chairman of that panel, U.S. Rep. John Mica, R-Fla., pledged to hold follow-up hearings in Washington, D.C., and to subpoena witnesses if necessary.
By Thomas Gnau - Dayton Daily News, Ohio (MCT)
©2013 the Dayton Daily News (Dayton, Ohio)
Visit the Dayton Daily News (Dayton, Ohio) at www.daytondailynews.com
Distributed by MCT Information Services