WASHINGTON, D.C. -- House Education & the Workforce Committee Chairman John Boehner (R-OH) today welcomed President Bush’s call for a review of the nation’s employee pension system and urged the Senate to follow the House in passing legislation to give rank-and-file workers access to professional investment advice on how to maximize their retirement savings.

     “Wealthy Americans can afford to hire an investment advisor to warn them that they’ve got too many eggs in one basket. Most working families can’t afford such a luxury,” Boehner said. “The House has passed bipartisan legislation to allow employers to provide their workers with access to high quality, professional investment advice. The Senate should follow suit.”

     The Retirement Security Advice Act (H.R. 2269) passed the House on November 15, 2001 by a bipartisan vote of 280-144, with the support of 64 Democrats. The bill reforms current law to give rank-and-file workers access to high quality investment advice. Current law, written more than 25 years ago when few employees had control over their pension investments, unintentionally discourages employers from providing their workers with access to investment advice.

     The bill has been endorsed by the White House, the Labor, Treasury, and Commerce Treasury Departments, as well as a broad array of employers and workers.

     “Protecting workers starts with reforming a system that denies them access to professional advice that can help them build a safe, secure nest egg for retirement,” Boehner said. “The Senate should follow the House’s lead so that President Bush can quickly sign this important reform measure into law.”

     In the wake of the Enron collapse, many respected analysts have called for greater employee access to information and advice about 401(k) investments and retirement savings. In the Boston Globe yesterday, columnists Steven Syre and Charles Stein stated that Globe readers were calling for more investor education, not government regulation, stating that, “Investors in 401(k) plans want freedom of choice. That means they don’t want to be told what to do with their money by either the government or their employers. That message came through loud and clear in the more than 40 e-mails we received in the past few days after we asked readers: Is it time for more regulation of the popular retirement plans?”

     Moreover, in a New York Times story today by reporter Daniel Altman, the director of the benefits group at consulting firm Watson Wyatt, Eric Lofgren, said that, “Legislative changes and regulatory changes can improve things, but they have to be really careful. It is possible for them to do more harm than good.” Lofgren also noted that education could encourage diversification. “The risk of lack of diversification,” he said, “is certainly something you want to communicate to anyone who has the option of going into one stock.”

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