[Congressional Record Volume 149, Number 32 (Thursday, February 27, 2003)]
[Extensions of Remarks]
[Pages E338-E339]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




            INTRODUCTION OF THE PENSION SECURITY ACT OF 2003

                                 ______
                                 

                            HON. SAM JOHNSON

                                of texas

                    in the house of representatives

                      Thursday, February 27, 2003

  Mr. SAM JOHNSON of Texas. Mr. Speaker, I am pleased today to join 
Chairman John Boehner in the reintroduction of the Pension Security 
Act. Last year, the House acted quickly in the face of corporate 
scandals to protect American workers' pensions by passing the Pension 
Security Act. Unfortunately, the Senate did not consider this bill in 
the last Congress which makes reintroduction necessary.
  Pension protection remains a key priority for all of us, and with the 
new Congress, we have a real opportunity to send President Bush a 
comprehensive pension security bill he can sign into law. We should not 
have to wait for another corporate scandal before we empower workers 
with new protections that can help them enhance and protect their 
retirement security. We are committed to addressing the pension 
security of American workers. Workers must be fully protected and fully 
prepared with the tools they need to protect and enhance their 
retirement savings.
  The Pension Security Act gives millions of Americans new tools to 
help them better manage and expand their retirement savings. The 
Pension Security Act gives workers new freedom to diversify 
contributions of company stock three years after receiving it in their 
401(k) accounts; expands worker access to high quality, professional 
investment advice; allows workers to purchase retirement planning 
services with pre-tax dollars; empowers workers to hold company 
insiders accountable for abuses; and gives workers better information 
about their pension plans. It also includes a number of provisions to 
make it easier for small businesses to start and maintain pension plans 
and would further protect rank-and-file employees by ensuring that 
statutory stock options will not be subject to payroll taxes.
  Last year, the Committee on Education and the Workforce and the 
Subcommittee on Employer-Employee Relations held a combined total of 
three hearings over four days to examine the collapse of Enron and to 
examine how to better protect pension participants. We heard testimony 
from Administration officials, pension experts, and rank-and-file 
employees.
  One theme that emerged from the testimony was that pension plan 
participants need more tools to effectively manage their retirements. 
Secretary of Labor Elaine Chao stated: ``Partnered with the proposed 
increased ability for workers to diversify out of employer stock, 
investment advice services will be more critical than ever.'' We also 
heard testimony from Tom Padgett, a former Enron employee. During a 
hearing, Chairman Boehner asked Mr. Padgett: ``Did you receive any 
information, or as I would describe it, investment education from your 
employers or others talking about the need to diversify your account?'' 
Padgett responded without hesitation: ``No sir.''
  Enron, like most U.S. companies today, did not provide its rank-and-
file workers with access to investment advice. The Pension Security Act 
would fix outdated federal laws to allow employers to provide their 
workers with high-quality, professional investment advice as an 
employee benefit while making advice providers personally liable for 
any advice not provided in the employee's best interest. Millions of 
employees who have seen their 401(k) balances dwindle might have been 
able to preserve their retirement savings if they'd had access to a 
qualified adviser who would have warned them in advance that they 
needed to diversify.
  I am concerned, as many of my colleagues are, about protecting 
workers and preparing them with the tools they need to protect and 
enhance their retirement savings. Congress made important steps forward 
last year with the Sarbanes-Oxley Act regarding corporate governance. 
That law incorporated two provisions from the original version of the 
Pension Security Act dealing with notice and trading during blackout 
periods.

[[Page E339]]

  Congress also passed the Job Creation and Worker Assistance Act (P.L. 
107-147) that expanded the interest rate ``window'' for valuation of 
current liabilities in defined benefit plans. Earlier in the 107th 
Congress, we also passed the Pension Security Act and the Retirement 
Security Advice Act with bipartisan support. We also passed the 
landmark reforms authored by my friend and colleague, Rob Portman, that 
gave workers more pension portability, faster vesting, and a host of 
other needed changes. These measures were a good start, but we need to 
do even more for American workers.
  I am proud that we are introducing the Pension Security Act as a 
bipartisan measure and I am hopeful that we can continue to work with 
our Democrat counterparts to reach consensus on the pension reforms I 
have just outlined. The nation's employer-based pension system is 
essential to the security of American workers. We should move quickly 
to finish the good work we began last Congress and restore confidence 
in our pension system. I urge my colleagues to join with me in helping 
America's workers by supporting the Pension Security Act.

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