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Release Date: 07/17/2001
Release Number: 01-32
Contact Name: Gloria Della
Phone Number: 202.219.8921
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Washington, DC - Ann L. Combs, Assistant
Secretary of Labor for the Pension and Welfare Benefits Administration (PWBA),
today testified before the House Committee on Education and the Workforce
in support of the Retirement Security Act of 2001 to give plan
participants greater access to investment advice. |
The legislation (H.R. 2269) would give plan
participants access to “fiduciary advisers regulated by state or federal
laws and provide disclosure to participants about fees, limits on the
scope of advice given and any conflicts of interest. |
Combs said, “The framers of federal pension law could
not anticipate the coming revolution for the pension universe or the
financial marketplace. Today, an estimated 43 million workers are covered
by a defined contribution plan, with most covered by 401(k) plans. |
“Participants increasingly must make investment
decisions that will affect their financial security and living standard at
retirement. Participants need personal, tailored investment advice. The
department believes that the legislation expands access to investment
advice for participants while allaying the concerns of employers arising
from that investment advise.” |
In her testimony, Combs focused on participants’ need
for investment advice and the need to address employer concerns over
providing advice. Many employers are concerned about assuming fiduciary
liability, including the fear that they would become responsible for
monitoring all recommendations made to participants. She recommended a
statutory amendment to define the scope of fiduciary liability for
employers in order to ensure that the bill protects participants. |
In conclusion, she commended the committee for
addressing the issue and voiced full support for the bill as a means to
provide certainty for the plan community while expanding the investment
advice needed by 401(k) participants. A copy of the full testimony is
available on PWBA’s Web site. |
U.S. Department of Labor
news releases are accessible on the Internet. The information in this news
release will be made available in alternate format upon request (large
print, Braille, audio tape or disc) from the Central Office for Assistive
Services and Technology. Please specify which news release when placing
your request. Call 202.693.7773 or TTY 202.693.7775. |