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15-Aug-08 11:15 [Americas]
US govt pressures company for pension obligations It was reported today that the American government has ordered bankrupt car part manufacturer, Delphi Corp, to pay $1.5 billion (£808 million) to its former parent company by the end of September.
Reuters stated that the company owes the money in the form of unfunded pension obligations, which it has to pay General Motors Corp (GM), according to a source near to the New York Times.
It added that the Pension Benefit Guaranty Corp warned GM and Delphi that it would claim $8 billion if the car manufacturer did not keep its pension scheme running, in a move to secure the safety of payments to workers.
The news provider also noted that the separation of Delphi from GM also created a deal wherein GM would "assume pension and health care obligations of thousands of Delphi employees represented by the United Auto Workers union should the supplier be unable to do so".
A report last month by the Motley Fool revealed that pensions at General Motors were "sufficiently funded or better".
Telecommunications and mobile phone company Motorola has announced that it is permanently freezing its defined benefit pension plans as well as suspending contributions to another plan.
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New York's attorney-general Andrew Cuomo has urged executives of top companies to forgo their bonuses for the year, it has been revealed.
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The Argentinean government has announced its surprise plan to nationalise its private pension system, causing chaos in the country's financial market.
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