Portman, Cardin Mull Advice Reform Proposal

August 15, 2001 (PLANSPONSOR.com) - Plan sponsors may find it easier to help participants obtain investment advice if pension reformers U.S. Representatives. Rob Portman (R-Ohio) and Ben Cardin (D-Maryland) have their way.

Among the possible proposals for a follow-up bill the two legislators expect to discuss after the August Congressional recess is legislation that would allow companies to pay for employees to get finance advice, Portman spokesman Jim Morrell told PLANSPONSOR.com.

Still unclear is whether that would mean visiting a financial planner or whether it could include purchase of advice computer software, he said.

Morrell said preliminary discussions have centered on companies offering the financial advice payment as part of a “cafeteria-style” benefits package, an approach currently barred.  

“Cafeteria-style” packages typically give employees a specific number of units which they can “spend” on an array of benefits including health, dental, vision, prescription drug, etc.

Not Done Yet

The notion of a “to do” pension reform list first surfaced publicly earlier this summer when Portman and Cardin told a Washington, D.C. conference that their recently enacted legislation was far from the end of their reform efforts (see Portman, Cardin Promise Pension Reform Follow-through ).

On the list, they told the conference, were proposals about participant education driven by the DC industry’s growth of participant-directed plans with long investment option lists.

Most of Portman and Cardin’s Comprehensive Retirement Security and Pension Reform Act was enacted into law as part of the Economic Growth and Tax Relief Reconciliation Act (EGTRRA) of 2001 (H.R. 1836).

– Fred Schneyer         editors@plansponsor.com

For the history of the Portman/Cardin pension reforms, see http://www.plansponsor.com/content/news/opinions/cardinportmanfeature