I hereby submit to the Congress the Annual Report of the Railroad Retirement Board for fiscal year 1981, pursuant to provisions of Section 7(b)6 of the Railroad Retirement Act, enacted October 16, 1974, and Section 12(l) of the Railroad Unemployment Insurance Act, enacted June 25, 1938.

The Chairman of the Railroad Retirement Board informs me that despite changes in railroad retirement negotiated by rail labor and management and enacted in the Omnibus Budget Reconciliation Act of 1981, the railroad retirement system faces severe financial difficulty. With the railroad industry's strong tradition of collective bargaining, it is my belief that the parties should be free to negotiate and implement changes in the railroad retirement system as part of their normal collective bargaining. Restoring the rail industry's pension to the private sector as proposed would free rail labor and management from inappropriate Federal intrusion in their affairs. The rights and benefits of active and retired rail workers would be unaffected by this reorganization, with the Federal government continuing to provide social security to retired rail workers, their families and dependents.

Ronald Reagan

The White House,

October 25, 1982.