Compliance October 7, 2000

Lawmakers To Take Up Pension Proposals

July 10, 2000 (PLANSPONSOR.com) - Lawmakers will return from the July 4th recess this week with a number of pension reform provisions on the docket, including proposals that would help workers ease into retirement, increase pension portability and trim regulatory requirements.
Reported by

According to BNA Pension and Benefits Reporter, Rep. Earl Pomeroy (D-N.D.) and Sen. Charles Grassley (R-Iowa) are expected to introduce the Phased Retirement Liberalization Act this week. The bill would permit employers to provide in-service distributions from defined benefit plans to workers that reach age 59 1/2 or 30 years of service.

The measure would give employers and employees additional flexibility in easing toward retirement – with workers drawing a partial salary and a partial pension benefit, while their pension continues to grow.  In most circumstances under current law individuals may not both remain on the job and draw full/partial pensions from their employer.

Phased retirement arrangements were the focus of an April 3 hearing sponsored by the Senate Aging Committee, which Grassley chairs.

The House Ways and Means Committee is expected to put their pens to work this week, marking up a stand-alone retirement savings package that includes pension policy reform tax provisions and initiatives to expand individual retirement accounts. The starting point is expected to be H.R. 1102 , sponsored by Reps. Rob Portman (R-Ohio) and Benjamin Cardin (D-Md.), which includes a number of pension provisions that would:

  • ease some regulatory requirements for qualified plans
  • expand pension coverage in the small business sector
  • increase pension portability
  • phase in an increase in annual contribution limits to individual retirement accounts, from $2,000 to $5,000.

– Nevin Adams      editors@plansponsor.com

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