Labor Secretary Raymond J. Donovan told a Senate subcommittee yesterday he is cracking down on pension fund mismanagement in the Teamsters union.
Department officials had been telling reporters that "on background" for several days in what has become a media battle involving the union, the department and the General Accounting Office.
The dispute stems from the government's costly, flawed inquiry into the operation of the multibillion-dollar Central States, Southeast and Southwest Areas Pension Fund of the International Brotherhood of Teamsters.
For example, the GAO yesterday gave the committee a report saying the Labor Department spent $8.5 million since 1975 on an investigation marked by "significant shortcomings" and one that "left unresolved problems" in the fund.
The GAO report is based on a three-year probe of the government's investigation. It mostly is old stuff, as Donovan pointed out yesterday in testimony before the Senate permanent subcommittee on investigations. But it is the kind of stuff that can be politically embarrassing, even to an administration that wasn't around when the problems developed.
Teamsters leaders know that. The union endorsed Ronald Reagan's presidential bid, but has found little solace in the administration's handling of the pension fund case. Last week, the union launched a publicity campaign portraying itself as the victim of government harassment.
The Teamsters campaign has angered Reagan administration officials, particularly those in the Labor Department who have been chafing under speculation that the department would be soft on the Teamsters because of the union's endorsement of Reagan.
Donovan, much to the delight of several subcommittee members who have been urging the department to get tough on allegedly wayward unions, served notice yesterday that he intends to take a hard line in dealing with the Teamsters.
He said the department has started "an intensive investigation of the current activities of the Central States Pension Fund" and is pursuing two suits against trustees of the fund because union officials have spurned efforts for a voluntary settlement of complaints against the fund's management.
Labor Department and Internal Revenue Service officials met with Teamsters representatives 20 times in the past two months in an attempt to reach an agreement, Labor solicitor T. Timothy Ryan Jr. said. But he said the talks broke off because the Teamsters "were unwilling to discuss" government proposals to change the way the union chooses pension trustees and to use trustees who have no connection with the union or the trucking industry. Ryan said those proposals "went to the very heart" of the troubled pension plan--"who is running the fund."
Donovan and Ryan said they would work closely with the Justice Department in probing any allegations of criminal wrongdoing by the Teamsters or other unions. That won them extra points with subcommittee members who have been critical of turf wars between Labor and Justice in the pension fund investigations.
Teamsters officials will present their case before the subcommittee today.