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. The bill would force the Internal Revenue Service (IRS) to adhere to a "whipsaw" theory regarding cash balance pension plans. The letter states 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."
According to ERIC, the proposed amendment is based on a report by the Office of Inspector General of the Department of Labor that threatens to damage the nation's private pension system by creating the false impression that many pension plans are underpaying plan participants. The OIG report, however misstates the law and is rebutted and discredited. Legislating in an appropriations bill a mandate based on this flawed report would be irresponsible.
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 letter urges Senators to reject Senator Harkin's provision and restore the $3 million appropriation to the Pension and Welfare Benefit Administration, according to ERIC. It also states that "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.
The legislation is expected to be considered by the full Senate Appropriations Committee next week and if passed, would effectively create a new office in the federal government by merely adding an overnight provision to a major appropriations bill. Language of the provision was made unavailable to the public until after Committee consideration. "The creation of a new office in the federal government should be subject of full debate in the light of day, the letter states."
More information about the proposed measures and copies of the letters sent by ERIC are available on the ERIC Web site.
ERISA Industry Committee (ERIC) urged both the House and Senate to reject two separate measures that would affect benefits paid from cash balance pension plans and a provision to create a new "Office of Pension Participant Advocacy" in the U.S. Department of Labor.