Congress has to come up with a permanent method for supplying the interest rate benchmarks that employers use in pension calculations.[@@]
Larry Zimpleman, president of the retirement services unit at the Principal Financial Group Inc., Des Moines, Iowa., made that argument this week at a Senate Finance Committee hearing on pension reform.
Settling on a permanent pension rate system would a good way for Congress to start helping employers deal with the uncertainties that are hurting the U.S. defined benefit pension system, Zimpleman testified, according to a written version of his remarks.
“The best way to protect pensions for future retirees and working Americans is for Congress to enact permanent rules that lead to a fair and stable system,” Zimpleman said.
Zimpleman was testifying at one of 3 hearings Congress scheduled this week to examine the problems plaguing American retirement programs.
Congress came up with the current, temporary interest rate fix last year in an effort to postpone dealing with a class between a dispute about the best way to replace the 30-year Treasury bond benchmark. The U.S. Treasury Department stopped selling the bonds in 2001.
Lawmakers also are talking about Bush administration proposals and other proposals for increasing the stability of the Pension Benefit Guaranty Corp., a federal pension benefit guarantee program that now has a $23 billion deficit.