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GAO Issues Follow-Up Report on PBGC

September 12, 2008
Related Topics: Miscellaneous Legal Issues, Finance/Taxes, Latest News
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The U.S. Government Accountability Office on Thursday, September 11, recommended that the Pension Benefit Guaranty Corp. provide reports on its management and financial challenges to newly appointed board members, board representatives and its director in advance of the possible leadership change following the November presidential election.

PBGC executive director Charles E.F. Millard agreed to the recommendation and said the agency would continue to “work in concert with its board to provide the oversight information necessary to address the important issues that we confront in providing pension security to millions of Americans,” according to a comment letter included with the report.

The GAO report recommended that the PBGC give the reports to the Office of Inspector General and the GAO. No time frame was given.

This is a follow-up to a 2007 GAO report that recommended expanding the size of the PBGC board of directors; clearly defining the roles and responsibilities of board members, senior management and the director; and developing policies consistent with other government corporations.

The report noted that the PBGC’s board of directors remained composed of three members—the secretaries of Treasury, Labor and Commerce. Because of the small size, the board “has not been able to develop procedures and mechanisms to monitor the agency’s operations, such as standing committees, which are used by other government corporations,” the report said.

It also pointed out that the PBGC does not have the same reporting requirements that other government organizations have in regard to providing additional information to Congress. The GAO points to the Millennium Challenge Corp. and the Commodity Credit Corp., both of which are required to notify Congress before conducting certain financial transactions. Millennium Challenge works with countries around the world to reduce global poverty through the promotion of sustainable economic growth, and Commodity Credit was created to stabilize, support and protect farm income and prices.

Filed by Jennifer Byrd of Pensions & Investments, a sister publication of Workforce Management. To comment, e-mail editors@workforce.com.

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