WASHINGTON, D.C. - The House Education & the Workforce Committee today gave bipartisan approval to the Pension Security Act (H.R. 1000), the comprehensive pension protection bill backed by President Bush and passed by the House last year that would give millions of Americans new tools to help them better manage and expand their retirement savings. The Committee passed the bill with bipartisan support by a vote of 29-19.

Democrat Reps. David Wu (D-OR) and Ron Kind (D-WI) joined Republicans in voting to approve the bill, authored by Education & the Workforce Committee Chairman John Boehner (R-OH) and Employer-Employer Relations Subcommittee Chairman Sam Johnson (R-TX) and co-sponsored by Reps. Baron Hill (D-IN) and Eleanor Holmes Norton (D-DC).

gAmerican workers deserve the security of knowing their savings will be there for them when they retire,h Boehner said. gThis bill couldfve made a real difference for the workers at Enron and WorldCom. Current pension laws are simply outdated, and we have a responsibility to change that.h

gExpanding worker access to quality investment advice is the most important pension protection of all,h noted Boehner. gThis bill is a common sense way to encourage employers to provide investment advice as a benefit to their workers, and it includes strong protections to ensure that they receive advice solely in their best interests.h

"Too many Americans have watched their retirement savings plummet. Today's action sends a strong signal that Congress wants to do all we can to help Americans reach their golden years financially secure," said Johnson.

The Pension Security Act (H.R. 1000), which will provide important protections to working Americans with employer-based retirement plans, largely mirrors the bill that was passed by the House last April. It will give workers unprecedented new retirement security protections that would have helped protect thousands of Enron and WorldCom employees who lost their savings during their companiesf collapses if the bill had been law.

The House passed the Pension Security Act last April by a bipartisan margin of 255-163, with the support of 46 Democrats. Unfortunately, the Senate did not schedule a vote on the Pension Security Act or any other comprehensive pension reform measure before Congress adjourned. President Bush reaffirmed his support for the Pension Security Act this year in his FY 2004 budget request and indicated he will sign it into law when it reaches his desk.

# # # # #

The Pension Security Act (H.R. 1000) gives workers new freedoms to diversify their retirement savings within three years; expand worker access to investment advice to help them manage their retirement accounts; empower workers to hold company insiders accountable for abuses; and give workers better information about their pensions. The following provides a more comprehensive summary of provisions included in the bill:

• Giving Workers Freedom To Diversify. The Pension Security Act gives employees new freedom to sell company stock and diversify into other investment options. It gives employers the option of allowing workers to sell their company stock three years after receiving it in their 401(k) plan (a three-year rolling diversification option) or allowing workers to sell their company stock within three years of service for the company (a three-year diversification cliff). In addition, it prohibits companies from forcing employees to invest any of their own retirement savings contributions in the stock of the employer.

• Enhancing Worker Access to Quality Investment Advice. As more and more employers provide 401(k) plans to their workers, rank-and-file employees are shouldering more of the risk of their investment. Unfortunately these employees rarely have the time or knowledge to actively manage these investments and most have no access to quality investment advice through their employer. Thousands of rank-and-file Enron and WorldCom employees might have been able to preserve their retirement savings if theyfd had access to a qualified adviser who would have warned them in advance that they needed to diversify.

The Pension Security Act provides these employees with access to a qualified investment advisor who can inform them of the need to diversify and help them choose appropriate investments. Fiduciary and disclosure safeguards will ensure that advice provided to employees is solely in their best interest. The House passed this provision as a stand-alone measure on November 15, 2001 (the Retirement Security Advice Act) with the strong support of 64 Democrats. The bill also provides a new tax incentive, authored by Rep. Rob Portman (R-OH), to help employees pay for the cost of retirement planning services.

• Clarifying that Employers are Responsible for Worker Savings During Blackouts. The Pension Security Act reiterates that companies have a fiduciary responsibility for workersf savings during blackout periods.

• Giving Workers Better Information About Their Pensions. The Pension Security Act requires companies to give workers quarterly benefit statements that include information about accounts, including the value of their assets, their rights to diversify, and the importance of maintaining a diversified portfolio.

• Simplifying Pension Plans. The bill includes a number of provisions designed to make it easier for small businesses to start and maintain defined benefit pension plans. For example, it simplifies reporting requirements for pension plans with fewer than 25 participants. In addition, it reduces Pension Benefit Guaranty Corporation (PBGC) insurance premiums for small and new pension plans.

The bill does not include two Pension Security Act provisions that were signed into law by President Bush as part of the Sarbanes-Oxley corporate accountability law. These provisions bar company insiders from selling their own stock during blackout periods when workers canft make changes to their 401(k)s and require pension plan administrators to notify workers 30 days before the start of any blackout period.