Date: 2008-07-09
Speaker: GEORGE MILLER (democrat)
Chamber: H
State: California

Mr. Speaker. I want to thank the Ways and Means Committee for sheparding this bill. the Pension Protection Technical Corrections Act. to the floor. The Pension Protection Act contained major changes to the funding rules for defined benefit pension plans. The final bill was over 900 pages long. As can be expected with any massive legislative vehicle. the final law contained dozens of mistakes. some techrhical and some not so technical. The bill before us today primarily fixes only the technical errors that have been found in the bill. It does not seek to make any changes in pension policy. The bill was put together by the staffs of all the committees of jurisdiction. both in the House and Senate and on both sides of the aisle. The bill has been vetted by the key regulatory agenciesthe Department of Labor. Treasury Department. and the Pension Benefit Guaranty Corporation (PBGC). The bill mostly fixes incorrect punctuation and citations. It also contains a few substantive changes in places where the language of the PPA was unclear and clarification was needed for the agencies to be able to carry out the purposes of the law. I would like to address some confusion created by the Treasury Department. in which it. as part of its PPA interpretation. provided guidance on the wearaway of workers accrued pension benefits in cash balance plans. An important part of the Pension Protection Act was to make clear that the wearaway of workers benefits was illegal in cash balance plans. not only with respect to normal retirement benefits. but also with respect to early retirement benefits. As a political compromise.. Congress made this rule prospective only. with. the question of wearaway under the prePPA lawto be decided by the Federal courts. The Treasury Department issued a first ruling last year that undermined this carefully crafted compromise. Treasury recently. issued new rules in which it indicated it will not rule on prePPA wearaway. There are many court cases pending on this matter and it must remain solely to the courts to decide whether prePPA pension law permitted employers to wearaway workers otherwise legally protected accrued benefits. Although I did not support the PPA. I hope that the House can pass these technical changes and then move on to the more pressing retirement issues of the day. With the faltering ecoriomy and housing market crisis. more and more individuals are withdrawing their 401(k) pension monies in order to pay. their mortgages and other bills. These families are being forced to sacrifice their retirement security in order to survive day to day. The Congress needs to address the real retirement security crisis facing working families. The Pension Protection Act only made the problem worse. The law forced companies to speed up pension plan funding regardless of the financial status of the company or the pension plan. While faster funding had some superficial appeal. the real result is to encourage employers to terminate their pension plans or seek access to the accumulated assets. Workers are increasingly dependent on 401(k) savings plans for their retirement security. But as my Committee has found over the past year. 401(k) plans are being decimated by below average investment returns and excessive fees. The Congress needs to start thinking about these more pressing issues.