[Congressional Record Volume 142, Number 138 (Monday, September 30, 1996)]
[Senate]
[Pages S11990-S11991]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. KERREY (for himself and Mr. Simpson):
  S. 2176. A bill to amend the Internal Revenue Code of 1986 and the 
Social Security Act to provide for personal investment plans funded by 
employee security payroll deductions; to the Committee on Finance.


                THE PERSONAL INVESTMENT PLAN ACT OF 1996

  Mr. KERREY. Mr. President, in May 1995, it was my distinct pleasure 
to join the fine, distinguished Senator from Wyoming, the Honorable 
Alan K. Simpson, to introduce the Kerrey-Simpson Retirement Reform 
bills. The intent of this series of eight bills has two important 
goals: Put Social Security and other Federal retirement programs on the 
path to long term fiscal health; and renew America's commitment to 
national savings.
  Today, I rise with Senator Simpson to reintroduce two of these bills, 
S.824 and S.825, for the purpose of offering technical changes.
  Specifically, it was our original intent to permit contributors to a 
personal investment plan to pass the balance of such plan to their 
surviving spouse upon their death, except if the surviving spouse 
agrees in writing that such balance should be transferred to a 
designated beneficiary, such as child or sibling. Our intent was to 
provide the contributor with the greatest amount of flexibility in his/
her estate planning, while at the same time recognizing the 
vulnerability of a surviving spouse.
  The second technical correction would require that in the event of 
the contributor's death where there is no surviving spouse and there 
has been no designation of a beneficiary of the proceeds of the 
personal investment plan, the proceeds should revert to the deceased's 
estate, not to the Social Security trust fund. It was our original 
intent to allow contributors to retain ownership of their personal 
investment plan, even after death.
  The third technical correction would permit financial institutions--
in addition to banks--to administer personal

[[Page S11991]]

investment plans. It was our original intent to permit personal 
investment plans to be administered by the identical institutions 
permitted to administer individual retirement accounts.
  Finally, technical corrections are made to S.825 to adjust certain 
dates in the formula for determining benefits to our original intent.
  As these changes are technical in nature, we have been assured by the 
actuaries of the Social Security Administration that such changes 
should have no effect on the solvency of the Social Security trust 
fund.
  Finally, I would like to add what a joy and pleasure it has been to 
work with my good friend from Wyoming. His leadership and candidness on 
this issue will be sorely missed. But more importantly, Mr. President, 
the character and leadership of Alan K. Simpson as a Senator, 
colleague, and friend will be equally difficult to replace in the U.S. 
Senate.
  I wish him all the best in whatever his fine future holds, and I 
expect he will continue to fight the good fight on this matter of 
critical importance to our Nation's fiscal future.
  Mr. SIMPSON. Mr. President, on May 18, 1995, I joined my able and 
steady colleague Senator Bob Kerrey from Nebraska in introducing a 
series of eight bills to address the long-term problems of Social 
Security. I rise today to join Senator Kerrey in reintroducing two 
bills, S. 824 and S. 825, which address the long-term solvency problems 
of the Social Security Program. The changes that Senator Kerrey and I 
propose are technical in nature and are made in both S. 824 and S. 825 
unless otherwise indicated.
  Specifically, it was our original intent to permit contributors on a 
Personal Investment Plan [PIP] to pass the balance of such plan to 
their surviving spouse upon their death, except if the surviving spouse 
agrees in writing that such balance should be transferred to a 
designated beneficiary, such as a child or sibling. Our intent was to 
provide the contributor with the greatest possible flexibility in his 
or her estate planning, while at the same time recognizing the 
vulnerability of a surviving spouse.
  The second technical correction would require that in the event of 
the contributor's death where there is no surviving spouse and there 
has been no designation of a beneficiary of the proceeds of the 
personal investment plan, the proceeds should revert to the deceased's 
estate, not to the Social Security trust fund. It was our original 
intent to allow contributors to retain ownership of their personal 
investment plan, even after death.
  The third technical correction would permit financial institutions, 
in addition to banks, to administer personal investment plans. It was 
our original intent to permit personal investment plans to be 
administered by the identical institutions that were permitted to 
administer individual retirement accounts.
  Finally, technical corrections are made to S. 825 to conform to our 
original intent adjustments in the formula for determining benefits to 
our original intent.
  As these changes are technical in nature, we have been assured by the 
actuaries of the Social Security Administration that such changes 
should have no effect on the present solvency of the Social Security 
trust fund.
                                 ______