Upfront: The Big Pension Plan Chill

Although the pension plan funding crisis is beginning to ease, an Aon Consulting review of more than 1,000 private-sector defined-benefit plans shows that sponsors continue to freeze benefits.

Of the companies Aon studied, 2 percent froze pension benefits before 2001; another 15 percent have taken action to freeze benefits since January 1, 2001; and 6 percent are considering a future plan freeze. The primary reasons cited for these changes are the size and volatility of contributions, the impact of pension plans on corporate expenses, and general business conditions. Sponsors also named their inability to accurately predict future contribution requirements as a reason to freeze.