Senators on a committee dealing with pension issues reacted indignantly after hearing testimony from a Delphi Packard Electric salaried retiree about looming steep cuts in their pensions, the group's spokesman said Thursday.
''The sense of outrage among senators was obvious,'' Bruce Gump said after his testimony before the Senate Health, Education, Labor and Pensions, or HELP, Committee in the Dirksen Building.
Gump said the committee's highest-ranking Republican, Michael B. Enzi, vowed to demand documentation about Delphi Corp.'s bankruptcy from the U.S. Treasury on Thursday.
''The fact we were able to get the attention of the Senator is an outstanding achievement, and I have good reason to believe will lead to resolution of the issue,'' said Gump, 58, an engineer with more than 33 years with electrical wiring harness maker Delphi Packard in Warren.
The outrage in the Senate will make the issue ''more of a political hot potato and the kind of thing that people pay attention to. That's what we're after - the attention of the legislative branch so they will work directly with the (Obama) Administration to resolve it,'' Gump said.
Sen. Sherrod Brown, D-Ohio, who sits on the committee, said the retirees feel ''betrayed by the system that was supposed to protect them'' and are looking for ''fair treatment.'' He said he will join other senators in trying to ''strengthen and secure our defined benefit pension system.''
Retirees planned to follow up the Senate hearing by meeting today with Ed Montgomery, who directs the government's task force to help auto communities and workers.
''He's closest person we're likely to get in contact with from the administration,'' he said.
Gump said they also expect to make their case in front of a House of Representatives committee. No date has been set, but he said it likely will happen in the next few weeks.
''It's a wonderful thing that we live in a country where we can petition our government for redress of grievances,'' he said, praising the Warren Legislative Group, which he chairs, and other retirees for drawing Congressional attention to their situation.
U.S. Rep. Timothy J. Ryan, D-Niles, who introduced Gump at the hearing and is working on the House hearing, said he will ''continue to work to ensure that the Delphi retirees have their story heard.''
Many of the 20,000-plus Delphi salaried retirees across the country - 1,500 from Delphi Packard - stand to lose 30 percent to 70 percent of their pension after the auto parts maker turned over the plan to the federal insurer Pension Benefit Guaranty Corp. July 31.
Average Delphi salaried retirees could lose $300,000-plus over their lifetime, pushing them to or below the edge of poverty, Gump told the committee. He cited numbers compiled by Frank Akpadock, senior research associate of Youngstown State University's Center for Urban and Regional Studies, showing the economic hit to the Mahoning Valley will exceed $161 million a year, including extra health care costs facing the 1,056 retirees still in the area. Some 4,830 jobs in retail, food and other sectors the area's economy that depend on retirees' spending also are at risk.
Gump told the committee that no other group of workers or workers in the government-led bankruptcy of former Delphi parent General Motors Corp. has sacrificed to the extent of the Delphi salaried retirees. All other worker groups will get 100 percent of of their pensions through union negotiated agreements in which GM will make up for the PBGC shortfall.
Gump said the PBGC illegally gave up the lien worth as much as $3.4 billion it had placed on Delphi's profitable overseas assets in order to protect the pensions after Delphi's October 2005 Chapter 11 bankruptcy filing.
In return, the federal insurer received ''a mere $70 million'' in cash from GM and a $3 billion unsecured bankruptcy claim from Delphi - a claim the insurer had to realize would ultimately pay nothing, he told the committee.
''They took this action knowing that they would have to assume billions of dollars in unfunded pension liabilities and drastically reduce the pensions of Delphi retirees,'' Gump told the senators, adding the retirees believe that action violated federal law that protects pensions.
PBGC spokesman Jeffrey Speicher declined to comment on the allegation, which Delphi salaried retirees are pursuing with a law suit in federal district court in Detroit.
He said the agency, which took over Delphi's pension hourly and salaried plans Aug. 10 after its termination, didn't send a representative to the Senate hearing because it wasn't invited.
A major concern for salaried retirees is the length of time the PBGC will take to calculate their new pension. Retirees will continue to get their current amount until any changes are calculated. If they're entitled to less money, the extra amount they received will be deducted from their pension checks for the rest of their life. The amount that has to be be repaid could run into the thousands of dollars, the longer the calculation takes, Gump said.
A representative of the U.S. Government Accountability Office who spoke at the hearing said the PBGC could take as long as nine years to calculate the amount.
Speicher said it took longer in previous decades for the agency to run the calculations but that the average time with modern technology is two to three years.
He noted some factors, such as when a bankruptcy settlement is totally finished, are beyond the agency's control but said, ''We've done a good job reducing the time it takes to calculate'' benefits.