In a letter to the House of Representatives, ERIC strongly urged members to oppose a proposed amendment offered by Reps. Sanders, Gutknecht, and Hinchey in H.R.5120, the FY 2003 Treasury-Postal Appropriations bill, that would force the Internal Revenue Service (IRS) to adhere to a "whipsaw" theory regarding cash balance pension plans.
ERIC President Mark Ugoretz said in the letter that "the proposed amendment threatens to damage our nation's private pension system by creating the false impression that many pension plans are underpaying plan participants."
The proposed amendment is based on a report by the Office of Inspector General of the Department of Labor. ERIC says the report has been "discredited by many in the industry because of the invalid legal theory it is based on, which runs contrary to sound retirement policy."
In a separate matter, ERIC delivered a letter to senators urging them to defeat legislation offered by Senator Tom Harkin from the Appropriations Subcommittee on Labor, Health and Human Services, and Education that would appropriate $3 million to create an Office of Pension Participant Advocacy at the Department Of Labor.
The legislation would effectively create a new office in the federal government "by merely adding an overnight provision to a major appropriations bill," according to ERIC.
"Creating an Office of Pension Participant Advocacy will discourage plan sponsorship by distorting the role of the Department of Labor, creating confusion among employers, and creating a roadmap for additional litigation," Ugoretz stated in the letter. He went on to say that "the creation of a new office in the federal government should be subject of full debate in the light of day."
The ERISA Industry Committee (ERIC) is a non-profit association committed to the advancement of employee retirement, health, and welfare benefit plans of America's largest employers and represents exclusively the employee benefits interests of major employers. ERIC's members provide comprehensive retirement, health care coverage and other economic security benefits directly to some 25 million active and retired workers and their families.
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ERISA Industry Committee has urged both the House and Senate to reject two measures, one affecting benefits paid from cash balance pension plans, the other creating a new Office of Pension Participant Advocacy in the U.S. Department of Labor.