[Congressional Record Volume 141, Number 130 (Saturday, August 5, 1995)]
[Extensions of Remarks]
[Pages E1656-E1657]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]


                         PENSION SIMPLIFICATION

                                 ______


                            HON. ROB PORTMAN

                                of ohio

                    in the house of representatives

                         Friday, August 4, 1995
  Mr. PORTMAN. Mr. Speaker, I recently introduced a bill, H.R. 2037, 
which will make it easier for small businesses to offer pensions to 
their employees. This may not sound terribly exciting to most people, 
but it has the potential to enhance the retirement savings of millions 
of Americans. Currently, pension plans are so heavily regulated and so 
expensive to administer that only 19 percent of small employers--those 
with less than 25 employees--sponsored a pension plan at all. My bill 
will restore flexibility to our outmoded and bureaucratic pension laws 
and thus encourage employers, including both large and small 
businesses, to offer and maintain retirement plans that are vital to 
the retirement security of our Nation's workforce.
  My bill removes many of the burdens that small businesses face when 
trying to provide retirement programs for their employees. It will also 
made it easier for small businesses to provide retirement security for 
millions of Americans by providing a tax credit for starting a new 
pension plan. In addition, it removes the complex discrimination rules 
for small employers and exempts small businesses from the minimum 
participation rules.
  The response from small businesses in my district to this proposal 
has been overwhelmingly positive. For instance, one employer said ``the 
present law is far too complex, and is a serious deterrent to creating 
an employer sponsored benefit plan.'' Another explained that ``As small 
business owners, we whole-heartedly support--the Portman--effort to 
simplify the employee pension plans, thereby, giving the necessary 
relief to the many small businesses that are presently not able to 
participate in these plans.''
  A local realtor explained that:

       I concur that the current complexities, administrative 
     burdens, contributions and distribution rules and regulations 
     tend to discourage rather than encourage retirement savings. 
     . . . When I was in the banking business, we found it a 
     difficult process to properly and accurately establish and 
     serve as an administrator on various KEOGH and self employed 
     pension plans. Small business owners were either intimidated 
     or frustrated with all the complicated rules, regulations, 
     definitions and administrative ``hassles'' on the 
     establishment, funding and distribution in these retirement 
     plans.

  And a retailer in Batavia, OH said, ``These are overdue changes * * * 
we have had a married couple who work for us get snagged for 2 years in 
a row by the unfair family aggregation rules. Repeal of these rules * * 
* makes a great deal of sense.''
  Pension laws are complex and confusing. Since 1980, Congress has 
passed an average of one law per year affecting private sector 
pensions. As the rules and regulations governing pension plans have 
multiplied, defined benefit pension plans have become less and less 
attractive to employers. As a result, pension plan termination have 
consistently outpaced the growth of new plans.
  At a time when our national savings rate is so low, we should be 
encouraging private sector retirement savings, not crippling pension 
plans with more and more regulation.

[[Page E1657]]

  That is why we must simplify the process to increase retirement 
security and the ability to save for working Americans. And that is 
exactly what this bill does.


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