GAO released a 59 page report today on DOE management of costs and liabilities for contractors' pension and post-retirement benefit plans. Hopefully some LANL blog readers will download a copy and help us decipher what it all means.
The report can be downloaded at http://www.gao.gov/new.items/d08642r.pdf
Don't read the letter- skip to the slides.
ReplyDeleteThis is a report on the comparison of post-retirement benefits (mostly pension and post-retirement healthcare) offered at all DOE sites. The rules state that aggregate benefits must be no more than 105% of the benefits for a group of similar companies. LANL was already held to this rule at the change of contract- however, pre-changeover employees were grandfathered to old rules. Hence TCP-1 and TCP-2.
ReplyDeleteThe report complains that DOE is not forcing contractors that are 'too high' to reduce their benefits using a remediation plan. It also examines if plans are adequately funded. LANL is mentioned as being too high if one counts all employees- but within the 105% rules if one only counts new employees.
"The report complains that DOE is not forcing contractors that are 'too high' to reduce their benefits using a remediation plan."
ReplyDeleteAs in, fire all the TCP1 workers at LANL, I suppose? That should help do the trick. Or how about destroying the retirement medical benefits for current and future retirees? That would save a bundle from the lab's operating budget.
DOE has plans to nickle and dime the national laboratory workforce until they are places filled with nothing but the dregs of science who can't find anything better.
This is a report on about 45 DOE sites, projecting future DOE retiree obligations- not specifically LANL. LANL is probably close to the 105% benefit target because our contract is recent. A site like Sandia with an older contract might be high, say 115%. Therefore the contractor might be required by DOE to change healthcare or retirement matching over several years to bring itself inline with 105% Ben Val. Don't regard this report as another attack on LANL. It is not.
ReplyDeleteThe corporate world is dropping retirement medical benefits in spades. Since DOE now insists on "market driven" 105% comparisons, it is only a matter of time before DOE forces LANS to completely drop this benefit.
ReplyDeleteuntil they are places filled with nothing but the dregs of science who can't find anything better.
ReplyDeleteWhich is not the current situation, of course. So why are you still here?
What kind of pensions and retirement medical benefits do the DOE people get?
ReplyDeleteI downloaded the pdf and read most of it.
ReplyDeleteI spent three years consulting with LANL and LLNL folk on the details of this stuff.
The simple analysis is "Yes, it is bad but you already knew that."
In answer to "What should a person do to protect themselves?", the answer is "Find someone who understands the details and get them to help you make a plan."
In answer to "Can't I understand this myself and do the right thing?" Sure you can. All you need is 2 years worth of graduate work in finance and risk assessment.
P.S. The real risk is in the error bars on the estimated quantities. These error bars are not shown.
P.P.S. This is one of a number of oncoming trains for national lab folks. You can ignore it, complain about, or characterize it in detail. None of these are useful. A better plan is to figure out how to get out of the way with your assets intact. Good luck.
I like the slides for their lack of graphics and for their incomprehensible, in the time of a slide, text.
ReplyDeleteThese things are to useful slides what written Mandarin is to most Americans' comprehension.
Is there a way to change the train so that it is less devastating to national lab retirees?
ReplyDeleteYes.
Unfortunately, changing the train involves at least 50,000 DOE employees getting together, without anonymity, and doing politically astute thing.
DOE and Congress had good weapon labs which cost them next to nothing to be professionally managed and in which the employees' pensions were save, secure, and cost the government next to nothing.
ReplyDeleteThey've managed to turn all this into a $180 M annual cost at both labs (profit fees, GRT, hits to the operating budget for TCP2, etc.) and succeeded at completely demoralizing the scientific staff while greatly enriching a select few. Science at these national labs is in serious decline.
Mission accomplished, DOE! Heckavajob, Congress!
What's on tap for Act II?
Act II: Obama sweeps into power and taps out remaining science investments to pay for his socialist agenda.
ReplyDeleteOr McCain gets in and taps the science budget to pay for the war... Oh, right, that's already going on. Looks like LANL is in deep dodo either way.
ReplyDelete6/20/08 10:14 PM said:
ReplyDeleteAct II: Obama sweeps into power and taps out remaining science investments to pay for his socialist agenda.
That's right moron, let's hang in there with Haliburton and friends. Let's keep corporate America in charge. Just look at how wonderful a job the conservative capatilist brown shirts party has done the past eight years. Are you that stupid or just too damn ignorant to know that you are?
6/21/08 8:35 AM
ReplyDeleteR-i-g-h-t! . . . and the Democrats are such staunch supporters of science AND a strong military.
When you used the term moron, you must have been looking in the mirror. We lead such a sheltered high quality of life in the US we can't even imagine what it is like to not have basic freedoms. We may not agree with the current state of affairs at the laboratory, but we still have many options the we can either individually or collectively exercise.
Try to address your issues with out the 60's semantics. You'll be received by a larger audience if you do.
Oh, and its "c-a-p-i-t-a-l-i-s-t."
Stepping back from a position of political bias and looking at the current affairs landscape, the condition of the US economy indicates that the Democrats will sweep the 2008 elections. It's the same type of set up as seen in 1992 with Bill Clinton, except this trend looks even stronger according to recent polling data.
ReplyDeleteIn New Mexico, polling data indicates that Tom Udall will become St. Pete's replacement. Both Tom Udall and Jeff Bingamin are lukewarm toward the New Mexico labs. Pair that with a Democratic Congress and Democratic President who have no desire to spend funds for Weapons Activities in the DOE budget and you'll probably be witnessing very big downsizing at LANL by 2010. Congress will add a little extra funding for TR and non-proliferation work, but not nearly enough to cover the cuts and support the current staff size at LANL.
By 2012, LANL is probably going to be at least 30% smaller than it is today with a smaller percentage of scientists on the payroll. LANL won't be scaling up for pit production and it also won't be doing much in terms of nuclear weapons activities. This type of work will effectively be put at "life support" funding levels. Significant amounts of funding will be diverted from the LANL and LLNL weapons accounts to the other DOE national labs that are more actively involved with energy research. The big ramp up in energy research will be sold to the public as "national security" activity.
The current DOE Weapons Activity budget for FY09 is coming in at around $6.2 B. I wouldn't be at all surprised to see it cut back to around $4.5 B during the next four years. Note, this doesn't take into account inflation rates, which are rapidly rising. The financial pain at LANL and within the Los Alamos community may be severe.
Good luck, and prepare as best you can.
Federal law requires private pensions to issue an annual financial statement to everybody in the plan and also provide the Plan Documents to plan participants upon request. I know some of you asked to see the plan and were ignored.
ReplyDeleteAfter two years in LANS TCP-1 have any of you seen either?
Figure it out. The only time we get good government is when one party has the White House and the other has Congress. Every time the Executive Branch and Legislative branch are controlled by the same party, we only get runaway spending. Democrats spend money on their Socialist agenda, Republicans on the Military-Industrial complex. Both parties spend to buy votes and campaign contributions.
ReplyDeleteIt's best to split your vote.