GAO

United States General Accounting Office

Report to the Ranking Minority Member, 

Subcommittee on Employer-Employee 

Relations, Committee on Education and 

the Workforce, House of Representative

June 2001 RETIREMENT 

SAVING

Opportunities to 

Improve DOL's SAVER 

Act Campaign

GAO-01-634
Page i GAO-01-634 DOL's SAVER Act Campaign

Letter 1

Appendix I Scope and Methodology 20

Appendix II Comments from the Department of Labor 22

Tables

Table 1: Estimated Direct Obligations and Expenditures for SAVER

Act Outreach Program Activities, Fiscal Years 1998

Through 2000 12

Table 2: Description of Major PWBA Outreach Activities 13

Abbreviations

ASEC American Savings Education Council

DOL Department of Labor

GIG Government Interagency Group

PWBA Pension and Welfare Benefits Administration

SAVER Savings Are Vital to Everyone’s Retirement Act of 1997

Contents
Page 1 GAO-01-634 DOL's SAVER Act Campaign

June 26, 2001

The Honorable Robert Andrews

Ranking Minority Member

Subcommittee on Employer-Employee Relations

Committee on Education and the Workforce

House of Representatives

Dear Mr. Andrews:

Many of today’s workers may not be financially prepared for retirement

when they stop working. For example, the most recent national survey

data available indicate that 53 percent of workers lacked an employee

pension plan in 1999.1

 Another survey indicates that, while most workers

in their late fifties and early sixties, the age at which they are looking soon

to retire, have financial assets, the median value of those assets was less

than $46,000 in 1998.2

 Workers need to prepare financially for retirement

because, while Social Security will provide some income to most retired

persons, that income alone will likely not be sufficient to provide a

comfortable standard of living. Retirement savings, including employee

pension plans and individual retirement accounts, can provide the

additional income needed to supplement Social Security benefits.

Concerned that people are not saving enough for retirement, the Congress

enacted the Savings Are Vital to Everyone’s Retirement (SAVER) Act of

1997.3

 The act requires the U. S. Department of Labor (DOL) to hold

 1

The estimate is based on the March 2000 Current Population Survey, and includes all

members of the civilian, non-institutional population who were age 16 or older and

employed at some time during the year preceding the survey, except the self-employed. The

estimate excludes self-employed persons because the survey does not collect information

on Keogh plans, a type of pension plan for the self-employed. See appendix I for

information on sampling and nonsampling errors. We analyzed the proportion and

characteristics of workers who lack pensions in our report entitled Pension Plans:

Characteristics of Persons in the Labor Force Without Pension Coverage

(GAO/HEHS-00-131, Aug. 22, 2000).

2

Arthur B. Kennickell, Martha Starr-McCluer, and Brian J. Surette, “Recent Changes in U.S.

Family Finances: Results from the 1998 Survey of Consumer Finances,” Federal Reserve

Bulletin (Jan. 2000). In this analysis of Survey of Consumer Finances data, financial assets

include checking and savings accounts; stocks, bonds, and mutual funds; and Individual

Retirement Accounts, Keogh accounts for the self-employed, and certain employersponsored accounts, such as 401(k) accounts. Surveys are conducted every 3 years.

3

P.L. 105-92, Nov. 19, 1997.

United States General Accounting Office

Washington, DC 20548
Page 2 GAO-01-634 DOL's SAVER Act Campaign

periodic national summits and maintain an outreach program to promote

retirement saving. Because the second national summit is to be held this

year, in 2001, you asked us to provide you with information concerning the

implementation of the act. Specifically, we agreed to (1) identify major

accomplishments of the 1998 summit and issues that might affect future

summits, (2) describe DOL’s outreach program, and (3) determine what

DOL knows about the effectiveness of the summit and outreach program.

To obtain this information, we interviewed officials at DOL’s Pension and

Welfare Benefits Administration (PWBA), other government agencies

sponsoring saving and investment education programs, and other

organizations that focus on saving and retirement issues. We also reviewed

documents provided by these agencies and organizations, including a

report to the President and congressional leadership summarizing

activities at the 1998 National Summit.4

 We conducted our work between

October 2000 and April 2001 in accordance with generally accepted

government auditing standards. (See app. I for our scope and

methodology.)

The 1998 National Summit made progress in addressing some of the

purposes specified for the summits in the SAVER Act. For example, as

required by the act, the summit identified problems that workers face in

saving for retirement and barriers that employers face in helping workers

save for retirement. Additionally, while observers and attendees agreed

that publicity about the summit may have increased the public’s awareness

and knowledge of retirement saving issues, a summit purpose specified in

the act, they disagreed as to the extent of that increase. The 1998 summit

did not develop recommendations addressing retirement saving issues and

coordinating government education programs, as called for in the act. It

remains for the 2001 and 2005 summits to develop such recommendations.

In March 2001, DOL was in the process of developing a proposed agenda

for the 2001 summit, and it was unclear at that time to what extent the

proposed agenda would address the development of recommendations.

DOL’s Retirement Savings Education Campaign, which began 2 years prior

to passage of the SAVER Act, is an outreach program that targets owners

of small businesses, women, minorities, and youth to change the way they

 4

Department of Labor, The National Summit on Retirement Savings (Washington, D.C.:

Sep. 3, 1998).

Results In Brief
Page 3 GAO-01-634 DOL's SAVER Act Campaign

think about, and act on, their retirement saving needs. Since 1998, PWBA

has spent about $850,000 on average in each of the last 3 years—or about 1

percent of its annual obligations and expenditures—to implement its

outreach program, which is now under the authority of the SAVER Act.

Most of those funds have been used to develop and distribute educational

materials. Other outreach activities include creating and distributing radio

and print public service announcements, cosponsoring conferences and

attending public meetings, and maintaining an Internet site. DOL leverages

its resources with in-kind contributions from partner organizations. DOL

also coordinates its outreach activities with other federal agencies that

promote retirement saving but agency officials disagreed on the extent of

that coordination.

DOL has not attempted to assess the extent to which the 1998 National

Summit and PWBA outreach efforts have increased the public’s knowledge

and understanding of retirement saving. While DOL collects information

on the number of publications distributed, it does not know the extent to

which materials are useful to the recipients. PWBA officials told us that

they plan to make other efforts to evaluate DOL’s outreach activities in the

future by including questions and surveys in publications and holding

focus groups; however, they have yet to establish a timetable for

conducting evaluations.

This report contains recommendations to the Secretary of Labor

concerning actions needed to evaluate the effectiveness of the major

activities of DOL’s retirement saving outreach program. In its written

comments, DOL concurred with our recommendations to develop and

implement a more systematic method for measuring the effectiveness of

its outreach activities that is commensurate with the size and scope of the

retirement saving outreach program.

In the United States, major sources of retirement income are Social

Security; retirement savings, including employee pension plans and

individual retirement accounts; and to the extent retired persons are

willing and able to continue working, wages and salaries. While Social

Security provides a foundation for retirement income, saving through

pension plans and by individuals on their own behalf contributes

substantially to ensuring a secure retirement.5

 5

National Saving: Answers to Key Questions (GAO-01-591SP, June 2001).

Background
Page 4 GAO-01-634 DOL's SAVER Act Campaign

U.S. tax policy encourages workers to save for retirement by providing

preferential tax treatment to employee pension plans and individual

retirement accounts. There is some evidence, however, that tax policy

alone may not be sufficient to address some of the causes of low saving.6

For example, low saving may result in part from financial illiteracy, and

many individuals may poorly understand their economic vulnerabilities or

the economic incentives that tax policies seek to create.7

 If so, educating

the public about retirement saving may help stimulate saving.

In 1995, recognizing that education might influence saving behavior, DOL

initiated the Retirement Savings Education Campaign to educate

individuals about the importance of saving for retirement. Two years later,

the Congress enacted the SAVER Act to promote retirement saving.

Specific purposes of the act are to

• provide for periodic bipartisan national retirement savings summits to

elevate the issue of retirement saving to national prominence;

• initiate the development of a broad-based, public education program to

encourage and enhance individual commitment to a personal retirement

saving strategy; and

• advance the public’s knowledge and understanding of retirement saving

and its critical importance to the future well-being of American workers

and their families.

Within DOL, PWBA is responsible for planning and conducting national

summits and maintaining an effective outreach program.8

 National

 6

B. Douglas Bernheim, “Rethinking Saving Incentives,” Fiscal Policy: Lessons from

Economic Research (Cambridge, MA: Massachusetts Institute of Technology, 1997) and

Sendhil Mullainathan and Richard H. Thaler, Behavioral Economics, Working Paper 7948,

Cambridge, MA: National Bureau of Economic Research (Oct. 2000).

7

B. Douglas Bernheim, and Daniel M. Garrett, The Determinants and Consequences of

Financial Education in the Workplace: Evidence from a Survey of Households, Working

Paper 5667, Cambridge, MA: National Bureau of Economic Research (July 1996).

8

PWBA’s primary mission is to protect the pension, health, and other employee benefits of

the over 150 million participants and beneficiaries in over 6 million private sector employee

benefit plans. Within PWBA, the Office of Participant Assistance and Communication

provides employee benefit plan participants and the general public with publications and

other information to help them better understand their benefits and rights.
Page 5 GAO-01-634 DOL's SAVER Act Campaign

summits are to be convened by the President in 1998, 2001, and 2005.9 The

first summit was held on June 4-5, 1998, in Washington, D.C., and was

conducted by DOL with the assistance of the American Savings Education

Council (ASEC).10 As required by the SAVER Act, the federal government

and the private sector shared the cost of the 1998 National Summit.

According to PWBA, the federal government spent about $177,000, and

according to ASEC, the private sector spent about $498,000.11 The

Congress has appropriated $500,000 for the 2001 summit. In March 2001,

DOL issued a request for proposals and, at this writing, is in the process of

selecting an entity to assume some of the administrative burdens and

share the cost of the 2001 summit.

Other federal agencies, including the Department of the Treasury and the

Social Security Administration, also have or are planning to have programs

to promote financial literacy and retirement saving. For example, in April

2000, the Department of the Treasury launched the National Partners for

Financial Empowerment. The organization is a coalition of consumer,

community, business, and nonprofit groups; corporations; and federal,

state, and local government organizations. The organization’s mission is to

increase the public’s awareness of financial literacy and education issues.

Additionally, the Social Security Administration plans to launch a

nationwide “Save for Your Future” campaign to, among other things,

increase the public’s knowledge of Social Security programs and

awareness of the importance of saving.

 9

 The summits are to be convened by the President and cohosted by the Speaker and

Minority Leader of the House of Representatives and the Majority and Minority Leaders of

the Senate. The act provides for a number of statutory delegates, including the President

and majority and minority congressional leaders. The act also specifies that up to 200

additional delegates may be appointed: 50 percent by the President and 50 percent by the

congressional leadership from the opposing political party.

10The SAVER Act requires DOL to consult and coordinate with an organization made up of

private-sector businesses and associations partnered with government entities to promote

long-term financial security in retirement through saving. ASEC was that organization for

the 1998 summit. Formed in 1995, ASEC is a nonprofit coalition of public- and privatesector organizations that promote retirement saving.

11ASEC’s costs also included staff expenses.
Page 6 GAO-01-634 DOL's SAVER Act Campaign

The 1998 National Summit made progress in addressing some of the

purposes set out for the summits in the SAVER Act; however, delegates

and attendees at the summit sometimes disagreed as to the extent of that

progress. For example, attendees generally agreed that there was publicity

about the 1998 summit. Some believe that the publicity was substantial

and had a significant albeit unverified impact on the public’s awareness

and understanding of retirement saving issues. Others believe that the

publicity was too limited to have a significant impact on the public. PWBA,

Treasury, and ASEC officials said that planners did not intend for the

delegates of the first summit to develop recommendations for addressing

retirement saving issues that were called for in the SAVER Act. It remains

for the 2001 and 2005 summits to develop such recommendations.

However, as of March 2001, it remained unclear to what extent the agenda

for the 2001 summit would address the purposes for the summits related

to developing recommendations.

The purpose of the National Summit12 shall be to:

• Increase the public awareness of the value of personal saving for

retirement.

• Advance the public's knowledge and understanding of retirement saving

and its critical importance to the future well-being of American workers

and their families.

• Facilitate the development of a broad-based, public education program to

encourage individual commitment to a personal retirement saving

strategy.

• Identify problems workers have in setting aside adequate funds for

retirement.

• Identify the barriers that employers, especially small business employers,

face in helping their employees accumulate retirement savings.

• Examine the impact and effectiveness of efforts by individual employers to

promote personal saving for retirement among their workers and promote

participation in company saving options.

• Examine the impact and effectiveness of government programs at the

federal, state, and local levels to educate the public so as to encourage

retirement saving.

• Develop specific and comprehensive recommendations for the legislative

and executive branches of the government and for private sector action as

 1229 U.S.C. 1147(a).

1998 Summit

Addressed Some

Mandated Purposes
Page 7 GAO-01-634 DOL's SAVER Act Campaign

may be appropriate for promoting private pensions and individual

retirement saving.

• Develop recommendations for the coordination of federal, state, and local

retirement saving initiatives.

The act requires DOL to prepare and distribute a report describing summit

activities not later than 90 days after the summit is adjourned. The final

report describing activities of the 1998 summit was dated September 3,

1998.

Delegates and attendees agreed that the 1998 summit identified many

barriers that make it difficult for workers to save for retirement and for

employers to help workers attain that goal. Among the retirement saving

barriers that were identified at the summit were the workers’ lack of

knowledge about financial matters and retirement saving, the perceived

lack of sufficient income for both current needs and saving, and the lack

of access to employer-based pension plans. The summit also identified

barriers faced by employers, including confusing and complicated

government regulations that employers must contend with in setting up

and operating pension plans and the fact that many employees prefer a

larger paycheck to having future retirement benefits withheld from the

paycheck.

Government and ASEC officials said that the summit facilitated the

development of a broad-based education program to encourage saving.

They said that the summit brought together a diverse group of government

officials and private-sector representatives and gave examples of

successful partnerships to implement effective education programs to

encourage saving. For example, PWBA officials said that the summit

helped them recruit potential partners for PWBA’s Retirement Savings

Education Campaign activities. Similarly, a Treasury official said that the

summit helped facilitate the launching of the Department of the Treasury’s

National Partners for Financial Empowerment by identifying potential

partners. The summit also reinforced the need to focus on segments of the

public such as minorities and low-income workers who were at greater

risk than others of having inadequate savings and, therefore, might be

specifically targeted by DOL’s program.

1998 Summit Identified

Barriers to Retirement

Saving

1998 Summit Facilitated

the Development of Public

Education Programs
Page 8 GAO-01-634 DOL's SAVER Act Campaign

Summit delegates and/or attendees disagreed as to the extent that the 1998

National Summit increased the public’s awareness of the importance of

saving for retirement and advanced the public’s knowledge and

understanding of retirement saving. PWBA, Treasury, and ASEC officials

said that the 1998 summit was widely reported in the media and that, as a

result, it probably increased the level of the public’s awareness and

understanding of retirement saving issues. PWBA officials also said that

follow-up regional summits or related activities occurred in several states,

including New York and Texas, because of the National Summit. PWBA

officials told us, however, that they did not determine whether the

publicity or activities surrounding the summit had a long-term effect on

the public’s awareness or knowledge of saving-related issues. Several

union, corporate, and nonprofit representatives whom we contacted said

that the resulting publicity was not sufficient or that the publicity was

geographically too concentrated in the Washington, D.C., area; therefore,

its impact on the public’s awareness and understanding of retirement

saving issues was limited.

With respect to government saving education programs, DOL’s final report

describes efforts by PWBA in its Retirement Savings Education Campaign

and initiatives by the state of Oregon to educate the public concerning

retirement saving issues. PWBA officials said that the 1998 summit

essentially validated its ongoing Retirement Savings Education Campaign.

However, several attendees that we contacted said that the summit did not

address in-depth the effectiveness of government saving education

programs.

To some extent, the 1998 summit also examined the impact and

effectiveness of employer programs to promote retirement saving and

pension plan participation. For example, employers were encouraged to

increase pension plan participation by adopting procedures to

automatically enroll newly hired employees in their 401(k) plans. Shortly

after the summit, the IRS published a revenue ruling clarifying that

automatic enrollment in 401(k) plans is permissible for newly hired

employees.13 A union official said that the 1998 summit focused heavily on

defined contribution plans, such as 401(k) plans, and did not adequately

 13Revenue Ruling 98-30, Internal Revenue Bulletin 1998-25 (June 22, 1998).

1998 Summit May Have

Increased Public

Awareness

1998 Summit Examined to

Some Extent Government

and Employer Efforts to

Promote Retirement

Saving
Page 9 GAO-01-634 DOL's SAVER Act Campaign

address the need for defined benefit plans.14 The official said that people

who do not have enough money to save cannot rely on voluntary savings

approaches like 401(k) plans.

The 1998 summit made no recommendations for the government or the

private sector to promote private pensions or retirement saving and made

no recommendations for the coordination of government retirement

saving initiatives. PWBA, Treasury, and ASEC officials said that planners

did not intend for the delegates of the first summit to develop such

recommendations. According to a Treasury official involved in the

planning process, the decision not to develop recommendations at the

1998 National Summit was made at the National Economic Council level.15

According to the official, planning the first summit focused on areas of

agreement, building on what planners perceived to be clear evidence that

education could contribute to efforts to increase saving. The planners’

intentions for the 1998 summit were to bring people together to discuss

issues related to retirement saving and build relationships for future

initiatives and to avoid a potentially divisive debate over what policy

changes are needed to increase saving. Summit planners believed the

atmosphere might be more conducive to addressing the more contentious

issues, such as legislative proposals to promote saving, and developing

specific recommendations at the national summits in 2001 and 2005.

In December 2000, DOL requested comments from the public, to be

received by January 31, 2001, for purposes of developing a comprehensive

agenda for the 2001 summit. In March 2001, DOL was in the process of

reviewing the comments. At that time, it was not clear to what extent the

draft agenda for the 2001 summit would reflect the purposes in the act that

call for (1) developing specific and comprehensive recommendations for

actions by the legislative and executive branches of the government, and

the private sector, to promote private pensions and individual retirement

saving and (2) recommendations for the coordination of federal, state, and

local government retirement saving initiatives. According to PWBA’s

 14Pension plans are customarily classified as either defined benefit or defined contribution

plans. Defined benefit plans promise a retirement benefit that is usually determined by

salary level and length of service. A defined contribution plan specifies contributions to be

made, but the benefit depends on investment performance.

15The National Economic Council, which included the President, Vice President, the

Secretaries of State, the Treasury, and Labor, among others, was responsible for

coordinating and monitoring the implementation of the President’s economic policy.

1998 Summit Did Not

Make Recommendations
Page 10 GAO-01-634 DOL's SAVER Act Campaign

timeline, an agenda is to be submitted for comment to the White House

and congressional staffs in May 2001 and published in the Federal Register

in July 2001.16

With its public- and private-sector partners, DOL began promoting

retirement saving education in July 1995, under its Retirement Savings

Education Campaign. The campaign’s outreach efforts—now under the

authority of the SAVER Act of 1997—continue to build upon and reinforce

the need to save for retirement and educate workers and employers about

ways to save for retirement. DOL’s spending ranged from $775,271 to

$892,466 over the last 3 fiscal years—or about 1 percent of PWBA’s total

annual obligations and expenditures—to develop and distribute

educational materials, public service announcements and media outreach,

participate at conferences and public meetings, and establish an Internet

site to promote retirement saving. DOL leverages its resources with inkind contributions from partner organizations and coordinates its

outreach activities with other public and private organizations that are

involved in retirement saving issues.

DOL’s current outreach program is a continuation of its Retirement

Savings Education Campaign, which began 2 years before passage of the

SAVER Act. The campaign was launched in July 1995 in conjunction with

the Department of Treasury and approximately 65 private- and publicsector partners. With DOL acting as a catalyst, the campaign provided a

forum for the partners involved to provide information on pensions and

retirement planning to the public and employers. The campaign targeted

education and outreach activities at specific groups: small business

employees, women, minorities, and future generations of workers—

today’s youth. Under the umbrella of the Employee Benefit Research

Institute, the campaign partners formed ASEC to undertake initiatives to

raise public awareness about the importance of personal finance and

retirement planning. According to an ASEC official, over 100 private and

public institutions participate in the organization’s activities. DOL and

ASEC participate in each other’s retirement saving campaign efforts. Both

entities distribute each other’s publications, and ASEC provides DOL’s

 16The act states that DOL shall make available for public comment a proposed agenda for

the summit that reflects to the greatest extent possible the purposes for the summit set out

in the act. 29 U.S.C. 1147(f)(1)(C).

DOL’s Outreach

Activities Continued

Under SAVER Act

DOL’s Outreach Program

Under the SAVER Act
Page 11 GAO-01-634 DOL's SAVER Act Campaign

toll-free telephone number in its publications. In addition, ASEC and DOL

participate separately in retirement saving initiatives with other

organizations.

After 1997, some of the outreach activities and initiatives of the Retirement

Savings Education Campaign were no longer optional; they became

mandated by law. Under the SAVER Act, DOL is to maintain an outreach

program designed to effectively promote retirement saving. The program

is to be carried out by means that ensure effective communication to the

public, including creating educational materials, publishing public service

announcements, attending public meetings, and establishing an Internet

site. The act requires that the information made available by DOL as part

of its outreach program include

• a description of the vehicles currently available to individuals and

employers for retirement saving and

• information regarding matters relevant to establishing retirement savings,

such as the concept of compound interest and the importance of prudence

and diversification in investing.

In fiscal year 2000, DOL’s outreach program was redesigned, and the name

was changed to the “Saving Matters” Campaign; the program continues to

target small businesses, women, minorities, and youth. DOL has identified

the following goals for its Saving Matters Campaign for fiscal year 2001:

• Educate and motivate American workers about the need to save for

retirement.

• Increase the number of employers who receive information on retirement

saving plans and the number of employers that provide related education

for their workers.

• Serve as a catalyst for other private- and public-sector organizations that

are committed to advancing the level of retirement saving education so as

to increase the amount of retirement saving in America.

• Meet the requirements set out in the SAVER Act of 1997.

In addition, DOL’s outreach strategy for 2001 is to increase grass roots

outreach and education. In prior years, DOL’s national office conducted

the vast majority of the outreach effort with little regional and district

involvement. In 2001, DOL’s 15 regional and district offices are to have a

key role in delivering campaign messages and materials to local audiences

around the country. The campaign will continue to promote and distribute

materials developed in the past as well as create new products.
Page 12 GAO-01-634 DOL's SAVER Act Campaign

PWBA spending ranged from $775,271 in fiscal year 1997 to $892,466 in

fiscal year 2000—or about 1 percent of its total annual obligations and

expenditures17—for its outreach program. Table 1 shows that since the

SAVER Act was passed in November 1997, PWBA has spent most of the

funds to create and distribute educational materials. Other outreach

activities were preparing and distributing radio and television public

service announcements (PSAs), attending conferences and other public

meetings, and developing and maintaining an Internet site. These other

activities also served to advertise and help distribute educational materials

developed by PWBA and others. According to PWBA, 27 PSAs designed for

use in print, radio, and television outlets have been placed in over 20,000

newspapers, magazines, radio stations, and television stations nationwide

since 1998. Table 2 provides additional information about PWBA’s major

outreach activities.

Table 1: Estimated Direct Obligations and Expenditures for SAVER Act Outreach Program Activities, Fiscal Years 1998

Through 2000

Activity 1998 1999 2000 Total

Create and distribute educational materials $665,893 $650,671 $449,906 $1,766,470

Hold conferences and public meetings 25,000 82,000 376,100b483,100

Develop and distribute public service announcements and other

media outreach

84,078 125,746 53,000 262,824

Develop and maintain an Internet site 30,569 30,569

Travel and other activities 300 978 13,460 14,738

Total $775,271a$889,964 $892,466 $2,557,701

a

In addition, PWBA spent approximately $177,000 out of its existing budget for the 1998 summit.

b

This amount included a $350,000 contract with a non-profit organization to cosponsor a series of

conferences on financial issues for women.

Source: PWBA.

Additionally, officials estimated that in 2000 PWBA expended 3 to 4 staff

years to perform outreach activities related to the SAVER Act at an

estimated annual cost of $100,000 per staff year. PWBA personnel in field

offices began working on SAVER Act activities in fiscal year 2000.

 17PWBA annual obligations and expenditures during the same period ranged from about

$82 million to $98.8 million.
Page 13 GAO-01-634 DOL's SAVER Act Campaign

Table 2: Description of Major PWBA Outreach Activities

Outreach activity Description

Educational materials During fiscal years 1998 and 2000, DOL focused its SAVER Act outreach strategy on

developing and distributing pamphlets and other educational materialsa

 Publications

include Savings Fitness: A Guide to Your Money and Your Financial Future, Top 10 Ways

to Prepare for Retirement, Women and Pensions, About Retirement Savings, and Simple

Retirement Solutions for Small Business. SAVER Act publications are delivered upon

request at no cost to the individual.

Public service announcement and media

outreach

DOL uses print and broadcast (radio and television) public service announcements (PSAs)

as the primary method for promoting its retirement saving publications. PSAs are designed

to capture the attention of the intended audience, convince them that they need more

information about retirement saving, and motivate them to call the toll-free publication

number.

Conferences and public meetings DOL participates in conferences, workshops, forums, and summits. In 1998, DOL became

a national sponsor of the Everywoman’s Money Conferences. That conference is

designed to provide women of all ages with tools to improve their knowledge of financial

issues—particularly retirement saving. DOL also participates in public events as an

exhibitor or speaker at Securities and Exchange Commission town hall meetings, the

Association for Small Business Development Centers annual conference, and the National

Forum to Encourage Lower-Income Household Savings.

Internet sites PWBA’s Web site containing SAVER Act materials can be accessed through DOL’s Web

site (http://www.dol.gov/dol/pwba). The PWBA site includes retirement saving-related

publications, tips for consumers about preventing pension miscalculations, and many

other materials, including ASEC’s Ball Park Estimate, ® a tool to help estimate how much

money an individual will need at retirement. PWBA’s Web site also contains links to

several sites maintained by other federal agencies to promote saving, including the

Department of the Treasury’s Internet site promoting savings bonds. Working in

cooperation with the U. S. Chamber of Commerce, Merrill Lynch, and the Small Business

Administration; DOL also constructed a small business retirement saving site

(http://www.selectaretirementplan.org). This site allows small businesses to review various

plan options available to them and provides a description of the features of each.

a

DOL received requests for 854,000 publications between 1998 and 2000 via its toll-free publications

hotline established in 1997. The toll-free number (1-800-998-7542) is a central source for requesting

SAVER Act publications. DOL estimates it distributed about 2 million copies of SAVER Act and

publications related to other PWBA activities through all methods, including its 800 number, the

Federal Consumer Information Center, related conferences and events, and PWBA field office

activities, during that period.

Source: PWBA.

Over the years, DOL has partnered with both private- and public-sector

organizations to leverage its resources to help reach its target audiences.

For example, DOL’s Savings Fitness booklet was prepared and distributed

in collaboration with the Certified Financial Planners Board of Standards.

The booklet explains in simple terms the concept of compound interest

and describes various saving plans and how they work. The Board paid to

have the booklet written, and DOL paid to have the booklet printed and

distributed. The Secretary of Labor introduced the publication to 40

million readers in the pages of Parade Magazine, and the booklet had the

Partnerships and

Coordination With Other

Organizations
Page 14 GAO-01-634 DOL's SAVER Act Campaign

largest distribution of a SAVER Act publication from DOL’s 800 number

requests in 2000.

In 1999, DOL partnered with the Consumer Information Center and shared

the cost of including promotional cards (“Here Today, Gone Tomorrow”)

with 2 million income tax refunds to encourage taxpayers to save a

portion of their money for retirement. Respondents to the cards received

DOL brochures on retirement saving. The Consumer Information Center

paid for printing the cards. DOL paid for printing the brochures and the

distribution of the packages.

The SAVER Act also requires DOL to coordinate its outreach program with

similar efforts undertaken by other public and private entities. Officials at

DOL and other federal agencies said that this coordination takes place

primarily through meetings held by the Government Interagency Group

(GIG) of ASEC. The group—comprised of federal government partners

who meet every 2 months—discusses ongoing outreach activities and

initiatives. Participating agencies include the Administration on Aging,

Department of the Treasury, Department of Agriculture, Securities and

Exchange Commission, Social Security Administration, and others. Some

officials said that GIG meetings provide an effective forum for agencies to

share ideas and look for ways to collaborate, but other officials said that

the meetings were little more than recitations of the efforts each agency

has to promote savings and that little real coordination takes place. PWBA

officials said that its outreach activities are also coordinated through oneon-one meetings with the Social Security Administration and others

involved in saving outreach or education activities. While PWBA officials

acknowledged that there is no single federal entity leading

governmentwide efforts, they said that PWBA has served as a catalyst for

many of the activities taken by other federal agencies to promote

retirement saving.

Although assessing the overall contribution of the SAVER Act’s efforts

toward changing the public’s knowledge and understanding about

retirement saving would be difficult, DOL has not attempted to do so.

Additionally, DOL has not assessed the effectiveness of its specific

educational materials and outreach activities but believes that doing more

is possible. DOL collects data on the number of publications distributed

and informal comments on the quality of its publications but has not yet

implemented a systematic effort to assess whether the publications or

other outreach activities are effective in promoting retirement saving.

DOL Has Not

Assessed the

Effectiveness of

Activities to Promote

Retirement Saving
Page 15 GAO-01-634 DOL's SAVER Act Campaign

An overall goal of the SAVER Act is to advance the public’s knowledge and

understanding of retirement saving and its critical importance to the future

well-being of American workers and their families. Recent studies indicate

the public’s knowledge and understanding of retirement saving might have

changed since the act became law in 1997. The 2001 Retirement

Confidence Survey18 indicates, for example, that the percentage of workers

who had tried to calculate their retirement saving needs increased

between 1997 and 2001. PWBA said, however, that no evidence links the

apparent increases to DOL’s or other saving education efforts.

Determining the impact of the national summit or DOL’s outreach program

on the public’s understanding and knowledge would be difficult because a

range of other factors affects saving attitudes and behavior. Factors that

might influence saving attitudes and behavior include discussions of the

future of Social Security, the movement toward greater reliance on

account-type pension plans, and the aging of the baby boom generation.19

Similarly, the officials said that determining the factors that affect a

change in pension coverage rates is difficult due to the myriad economic

factors that shape employers’ decisions to sponsor retirement savings

plans, as well as the impact of the economy on household saving

decisions.

DOL has little information about the specific effectiveness of individual

publications and other outreach activities. DOL’s program activities

assessment has been largely limited to tracking quantitative data and

making note of the informal feedback it has received on the quality of its

publications. For example, DOL told us that its public service

announcements potentially reached over 180 million people; it distributed

over 500,000 SAVER Act publications through toll-free number requests;

and it records an average of about 24,000 visitors per month to its Internet

site. DOL received informal feedback on the usefulness of its publications

 18Retirement Confidence Survey 2001 Summary of Findings, Employee Benefit Research

Institute (Washington, D.C.: May 2001).

19In general, older workers may have higher preferences for saving, as opposed to

consumption, than younger workers. The theoretical basis for such preferences is found in

a life-cycle saving and consumption model. According to this model, expenditures typically

exceed earned income early in a person’s career because of immediate consumption needs

like child rearing and mortgage expenses. Later in life, earned income is more likely to

exceed consumption needs, allowing persons to save for retirement. See Olivia S. Mitchell

and James F. Moore, Retirement Wealth Accumulation and Decumulation: New

Developments and Outstanding Opportunities, Philadelphia: The Pension Research

Council (Apr. 1997).

Determining SAVER Act’s

Contribution on

Retirement Saving Would

Be Difficult

DOL Has Little Information

About the Effectiveness of

Individual Activities
Page 16 GAO-01-634 DOL's SAVER Act Campaign

from representatives of other organizations that have partnered with DOL,

from organizations that have distributed DOL’s publications, and from

individuals who have received DOL publications at conferences or public

events. While tracking qualitative data and informal comments may

provide some useful information, those two indicators alone do not

provide a systematic method to measure and evaluate the effects of

specific activities.

DOL recognizes the need to do more to measure the effectiveness of its

publications and other outreach activities, but officials cite the lack of

funds as the major obstacle. Officials said that funds were spent to

develop and distribute educational materials rather than to develop and

implement measurement activities. However, DOL has taken some steps to

improve its evaluation efforts. For example, DOL awarded a contract to a

nonprofit organization to conduct “before and after” surveys of the

Everywoman’s Money Conferences that DOL cosponsored. The surveys

were to measure changes in the saving awareness and behavior of

conference participants, but the contractor has not provided the required

post-conference results to DOL and is not expected to fulfill this contract

requirement due to its own financial difficulties.20 Moreover, DOL has not

evaluated the usefulness of its publications or information provided on its

Internet site.

For fiscal year 2001, PWBA requested $500,000 to evaluate the

effectiveness of its combined pension and health benefit advisor activities

as part of a $1.5 million expansion of that program. However, DOL did not

approve PWBA’s request. In a notice that requested information for

developing the agenda for the 2001 National Summit,21 DOL has also

requested information on measurement techniques that assess the

effectiveness of public outreach and media efforts. PWBA officials told us

that they plan to make other efforts to evaluate DOL’s outreach activities

in the future by including questions and surveys in publications and

holding focus groups; however, they have yet to establish a timetable for

conducting evaluations. The officials also expressed concern that these

efforts require time and money that would take resources away from the

activities themselves. Ideally, in their opinion, DOL would have an

 20However, PWBA officials said that they planned to conduct or make arrangements with

another contractor to follow up with the participants to evaluate the effect that the

conference had on the attendees’ knowledge of retirement saving or their behavior.

21Federal Register, Vol. 65, No. 232, Dec. 1, 2000, pp. 75578-75579.
Page 17 GAO-01-634 DOL's SAVER Act Campaign

independent organization evaluate the effectiveness of its outreach

activities, but the officials said that no funds exist for such an evaluation.

Our discussions with financial education researchers indicate that a

systematic follow-up effort to obtain feedback from recipients of the

publications—or educators and trainers who used the publication—is

important to implementing an effective education or outreach program,

such as DOL’s campaign. According to one researcher, such feedback

could be extremely useful not only for improving current products but also

for developing the next generation of products. The researcher also said

that follow-up efforts should be designed to be cost-effective. Accordingly,

the scope and methodology of performance or effectiveness measures

should be appropriately sized for a $900,000 outreach program. However,

the researcher believes that potential partners in the private sector or

financial education community could help design a cost-effective

measurement program. Another researcher said that, depending on the

funding level, an evaluation effort could range from calling recipients or

users to solicit their views about a material’s effectiveness to a more

formal effort by researchers to assess the quality and effectiveness of the

entire outreach program.

The SAVER Act summits present a unique opportunity for national leaders

and public- and private-sector organizations to come together to increase

public awareness of the value of saving for retirement and develop ways to

encourage private pensions and individual retirement saving. Summits

scheduled for 2001 and 2005 represent opportunities to make further

progress at achieving the mandated purposes of the summit that were

partially addressed at the 1998 summit. These summits also provide an

opportunity to address those mandated purposes that were not addressed

at the 1998 summit: the development of specific and comprehensive

recommendations for government and private sector actions with respect

to retirement saving issues and for the coordination of government

retirement saving education initiatives. However, achieving these purposes

is likely to be difficult. For example, developing recommendations to

promote private pensions and retirement saving or coordinating federal,

state, and local initiatives may require stronger leadership and cooperation

beyond that of the first summit.

The SAVER Act reinforced DOL’s prior outreach efforts under its

Retirement Savings Education Campaign begun in 1995. However, now

that the program has evolved over 6 years, DOL should take steps to

refocus its resources and refine its program by determining how well its

Conclusions
Page 18 GAO-01-634 DOL's SAVER Act Campaign

activities are succeeding and how the program might be improved. Given

the limited resources for its outreach program, DOL needs to ensure that it

has an effective strategy for reaching people and educating them about the

importance of planning for retirement and encouraging them to save.

Without a systematic effort to measure and evaluate the effects of its

outreach activities, DOL runs the risk of spending its resources on

activities that are not having their intended effect.

DOL should develop and implement a method for measuring the

effectiveness of the major activities of its outreach program. While we

recognize the potential costs and difficulties of measuring the

effectiveness of an outreach program, DOL needs to undertake such an

effort so that it has the information necessary to make the best use of its

limited resources. Therefore, we recommend that the Secretary of Labor

direct the Assistant Secretary of Labor, PWBA, to take the following

actions:

• Assess the results of program activities compared to their intended

purpose. For example, DOL could survey individuals on their improved

understanding, changed attitudes, or actions taken as a result of reading

DOL’s educational materials or visiting DOL’s Internet site.

• Appropriately size the scope and methodology of the evaluation effort for

a $900,000 outreach program. Depending on the level of funding, such an

effort could range from calling recipients or users of the materials to

determine their views on its quality or effectiveness to a more formal

effort by researchers to assess the quality and effectiveness of the entire

outreach program.

• In considering the scope of the potential evaluation effort, explore the

potential use of partners in the private sector or the financial education

community that could help design a cost-effective measurement program.

We provided DOL the opportunity to comment on the report, and DOL

concurred with our recommendations in its written comments. DOL also

commented further on the importance of partnerships to its retirement

education savings campaign and the results of its efforts working with

other organizations and agencies, which we incorporated as appropriate.

DOL’s letter is included as appendix II.

We are providing copies of this report to the Honorable Elaine L. Chao,

Secretary of Labor, and appropriate congressional committees. We will

Recommendations for

Executive Action

Agency Comments
Page 19 GAO-01-634 DOL's SAVER Act Campaign

also make copies available to others on request. The report is also

available on GAO’s home page at http://www.gao.gov. Please call me at

(202) 512-7215 or George A. Scott at (202) 512-5932 if you or any of your

staff have questions. Other major contributors to the report include Daniel

F. Alspaugh, John M. Schaefer, Vernette G. Shaw, and Roger J. Thomas.

Sincerely yours,

Barbara D. Bovbjerg, Director

Education, Workforce, and

 Income Security Issues
Appendix I: Scope and Methodology

Page 20 GAO-01-634 DOL's SAVER Act Campaign

To identify major accomplishments of the 1998 National Summit on

Retirement Saving, we reviewed Savings Are Vital to Everyone’s

Retirement (SAVER) Act of 1997 provisions governing national summits

and the background material and the final report for the 1998 summit. We

also examined evidence of media coverage of the 1998 summit

proceedings. We discussed the summit with attendees or delegates

representing the Pension and Welfare Benefits Administration (PWBA),

the Department of the Treasury, a union, a corporation, and the American

Savings Education Council and other nonprofit groups. To identify

challenges facing the 2001 and 2005 summits, we discussed summit

planning with PWBA officials and reviewed comments responding to a

Department of Labor (DOL) request for information for the 2001 summit

agenda.

To describe DOL’s outreach program, we interviewed PWBA officials and

reviewed various documents—including strategic plans and the SAVER

Act—to document the history of DOL’s program and the strategies used to

implement the outreach program. To document expenditures for outreach

activities related to the SAVER Act, we reviewed budget documents and

PWBA estimates of obligations and expenditures related to the SAVER Act

and discussed those documents with PWBA officials. However, we did not

independently verify PWBA’s estimates. To explain the various elements

(activities) of the program (i.e., educational materials, public service

announcements, conferences and public meetings, and Internet site), we

collected and reviewed educational materials, including brochures and

pamphlets and copies of the public service announcements. We visited the

PWBA Web site (http://www.dol.gov/dol/pwba) to view the Internet site

containing materials related to the SAVER Act, and we reviewed

documents describing conferences and public meeting engagements

related to the outreach program. In addition, we reviewed internal

documents provided by PWBA on the various activities of the outreach

program. For example, PWBA provided us with a summary document

entitled “Milestones and Achievements of the Retirement Savings

Campaign,” which highlighted various major milestones and events since

the outreach program began in 1995 through fiscal year 2000. To document

DOL’s partnerships, we interviewed other federal agencies and nonprofit

organizations involved in Saver Act outreach activities and reviewed

documents provided by PWBA describing their current partnership

activities. To document DOL’s coordination efforts, we obtained copies of

meeting minutes from the Government Interagency Group, which is the

primary vehicle used by PWBA to coordinate its efforts with other federal

agencies involved in SAVER Act activities.

Appendix I: Scope and Methodology
Appendix I: Scope and Methodology

Page 21 GAO-01-634 DOL's SAVER Act Campaign

To determine what DOL knows about the effectiveness of the summit and

outreach program, we reviewed strategic plans for DOL and PWBA and

summary information on the outputs of the PWBA outreach program

activities. We also looked at studies and reports by the Employee Benefits

Research Institute and other results-oriented guidance. We discussed the

effectiveness of SAVER Act activities and other retirement saving

education issues with PWBA officials in headquarters and the field,

university researchers, and other professionals in fields related to

retirement saving education.

We also used survey data from the Current Population Survey (CPS) for

background information contained in this report. CPS data contains

sampling and nonsampling errors. The sampling error for the CPS estimate

shown in this report is plus or minus one percentage point at the 95-

percent confidence level. The nonsampling errors can affect the accuracy

of the information presented, but the magnitude of their effects is

unknown. Nonsampling errors may result because persons did not

respond to some or all of the survey questions or the persons in the

household who responded were other than the employee or the

employee’s spouse.
Appendix II: Comments from the Department

of Labor

Page 22 GAO-01-634 DOL's SAVER Act Campaign

Appendix II: Comments from the Department

of Labor
Appendix II: Comments from the Department

of Labor

Page 23 GAO-01-634 DOL's SAVER Act Campaign (130004)

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