Subcommittee Reviews Private Pensions Plans
WASHINGTON, D.C., June 14, 2011
The Subcommittee on Health, Employment, Labor, and Pensions, chaired by Rep. Phil Roe, M.D. (R-TN), today held a hearing to review the state of private pension plans and the challenges facing plan sponsors, workers, and retirees.
"Roughly 60 million workers participate in an employment-based retirement plan," said Chairman Phil Roe. "They, like so many Americans, have felt the impact of the recent recession and continue to experience tough times during this slow economy. As more Americans reach into their retirement savings just to make ends meet, policymakers have a responsibility to examine the difficulties facing workers and retirees and discuss whether federal policies are helping or hurting efforts to rebuild retirement savings."
Witnesses described the difficulties confronting plans, including:
The recent recession
"The impact of the recession and financial crisis on retirement security is twofold. A decline in retirement assets (or the failure for assets to increase in value as expected) has left many workers and retirees with less than anticipated. Some older workers have chosen to remain in the workforce longer to offset the decline in retirement assets, but the overall unemployment rate of older workers remains high relative to pre-recession levels. And younger workers unable to find jobs due to the weak economy are not contributing to employer-provided retirement plans, thereby also reducing future retirement income and security." (Alex Brill, Research Fellow, American Enterprise Institute)
"In today’s globally competitive marketplace, employers are increasingly sensitive to the costs, risks, and potential liabilities of all their activities. Government policies that raise the costs, risks, and potential liabilities associated with retirement plan sponsorship jeopardize the employer commitment to providing retirement benefits." (James Klein, President, American Benefits Council)