Panel Looks At Retirement Plan Fees

- Getting ready to publish a proposed regulation that would require retirement plan service providers to tell plan fiduciaries about the providers’ direct and indirect compensation, fees, and other financial arrangements.

Earlier today, at the House committee hearing, committee members, administration officials and pension management industry representatives agreed on need for improving retirement plan cost disclosure practices.

“The best approach to the fee issue is through simple, clear disclosures that enable plan sponsors and participants to understand and compare fees in the context of the services and benefits being offered under the plan,” said Robert Chambers, who appeared on behalf of the American Benefits Council, Washington.

Chambers and other witnesses noted that poorly thought out changes could backfire and make plans even more confusing and expensive to run.

But Rep. George Miller, D-Calif., chairman of the Health and Labor Committee, said, “Doing nothing is not an option.”

There is a “likelihood” that legislation dealing with the issue will be introduced, Miller said.

Frank Keating, president of the American Council of Life Insurers, Washington, said in a statement after the hearing that financial services companies, federal policymakers and plan sponsors should continue to talk about ways to make sure sponsors have the information they need to evaluate plan features.