WASHINGTON - The federal agency that insures the private pensions of 44 million workers yesterday reported its fourth straight annual deficit.

The agency's liabilities were $22.8 billion greater than its assets as of Sept. 30, the end of the government's 2005 fiscal year, as big airlines in bankruptcy dumped their pension obligations onto the Pension Benefit Guaranty Corp.

However, the deficit was $500 million smaller than the 2004 gap, which was a record.

The 2005 report showed $56.5 billion in assets to cover $79.2 billion in pension liabilities.

"PBGC does not appear to have turned a corner yet," said Doug Elliott, head of the Center on Financial Institutions, a nonpartisan policy group in Washington.

There has been an explosion in recent years in the number of big, ailing companies - especially in such labor-heavy industries as airlines and steel - transferring their pension liabilities to the agency.

The agency, founded in 1974, is funded by insurance premiums paid by companies and by income from investments. The program took in 120 terminated pension plans in fiscal 2005 with $10.5 billion in assets and $21.2 billion in liabilities.

With billions of dollars flying out of the agency's door, concern has been mounting in Congress and elsewhere over its financial footing.

If events such as corporate bankruptcies that occurred after the end of the fiscal year Sept. 30 had been counted, the 2005 deficit would have been $25.7 billion, the agency said.

For the fiscal year, the agency reported $4 billion in losses from pension liabilities, while it collected only $1.5 billion in insurance premiums from companies. The agency earned $3.9 billion in investment income.

Without a legislative overhaul of the pension system for private companies, people retiring from financially troubled firms will have nowhere except the government to turn to for their promised pension payments.

Traditional employer-paid pension plans, giving retirees a fixed monthly amount based on salary and years of employment, are now estimated to be underfunded by as much as $450 billion. That could jeopardize the retirement security of millions of Americans, lawmakers have warned.

United Airlines and US Airways used bankruptcy earlier this year, with judges' blessings, to slash costs by dumping their employee pension liabilities - a combined $9.6 billion - onto the government agency.

Delta Airlines and Northwest Airlines, which both filed Sept. 14 for Chapter 11 bankruptcy protection, may seek to do the same. The pension plans of Delta and Northwest, the nation's No. 3 and No. 4 airlines, are underfunded by an estimated $16.3 billion.

There also is speculation that auto-parts-maker Delphi Corp., which filed for protection from creditors last month, could terminate its pension plan and transfer liability to the federal agency.

For months, lawmakers have been grappling with an overhaul of the rules governing company pension plans to tighten controls over employers with underfunded plans and to shore up the PBGC's finances.

Legislation cleared a key House committee last Wednesday, advancing what could be the most important retirement issue Congress would address this year as Social Security's overhaul has faded into the background.

The full House could take up the bill as early as this week.

Commentary:
I have a plan. The government should refuse to pay the pensions of companies that give money to a political party during the previous 10 years. That way they won't squander the money of their workers with bribes to members of congress.