Pension Benefit Guaranty Corporation - Revenues and Expenditures

Revenues and Expenditures

The PBGC is not funded by general tax revenues. Its funds come from four sources:

• Insurance premiums paid by sponsors of defined benefit pension plans;
• Assets held by the pension plans it takes over;
• Recoveries of unfunded pension liabilities from plan sponsors' bankruptcy estates; and
• Investment income.

PBGC pays monthly retirement benefits to approximately 631,000 retirees of 3,800 terminated defined benefit pension plans. Including those who have not yet retired and participants in multiemployer plans receiving financial assistance, the PBGC is responsible for the current and future pensions of about 1.3 million people.

The PBGC regularly updates its investment strategy. In 2004, it chose to invest heavily in bonds. Under new leadership, the agency in 2008 shifted a substantial portion of its assets into stocks. Because of the market decline, PBGC's equity investments lost 23% during the year ending September 30, 2008.