'I understand that representatives of GM and Delphi are engaged in ongoing negotiations toward a global settlement that may include the transfer of certain of Delphi's hourly plan liabilities to GM's hourly plan,' wrote PBGC director Charles E.F. Millard in a letter Tuesday obtained by The Detroit News today. PBGC already has filed liens against $1.6 billion in Delphi's foreign based assets, which aren't part of its bankruptcy filing. 'The parties must exert all efforts to effect the pension transfer -- the only sensible resolution that fairly protects the interests of Delphi's pensioners, the pension insurance system and ultimately the other creditors and parties in interest in Delphi's bankruptcy,' Millard wrote, copying GM chairman and CEO Rick Wagoner and the head of Delphi's unsecured creditors committee. PBGC sent a letter to GM and Delphi in August urging them to complete the deal by Sept. 30, but sent the new letter this week to push them toward a deal. Delphi spokesman Lindsey Williams said that 'Delphi and GM have been engaged in discussions aimed at devising a solution to Delphi's pension funding matters. Delphi is keenly aware of the funding status of its plans,' Williams said. 'Delphi and GM have been engaged in productive discussions and have routinely advised the PBGC of our progress and will continue to do so.' Delphi had hoped to emerge from bankruptcy in April, but failed to do so when its plan investors declined to carry out a deal to invest up to $2.55 billion in a newly recapitalized company. Delphi has sued its former lead investor and largest stockholder, Appaloosa Management LP, trying to force them to follow through on the investment. As part of Delphi's strategy to emerge from bankruptcy, GM had agreed to accept $1.5 billion of Delphi's pension obligations because its pension plans are overfunded. The company has used nearly $1 billion in cash in the first six months of the year and wants to borrow another $300 million from GM. A federal bankruptcy judge will consider the request on Sept. 23. Delphi has said it rewriting its plan of reorganization. You can reach David Shepardson at (202) 662 - 8735 or [email protected].