Pension Protection Act of 2006
The Pension Protection Act of 2006 (HR 4) was introduced on Saturday 28 July by Rep. John A. Boehner (R-OH-8). The House overwhelmingly (279 - 131) passed the bill the same day. The Senate overwhelmingly (93 - 5) passed the bill on Friday 3 August. President Bush signed the bill on Thursday, 17 August.
Bill Co-Sponsors
Rep Dave Camp [MI-4] - 7/28/2006
Rep John Kline [MN-2] - 7/28/2006
Rep Howard P. (Buck) McKeon [CA-25] - 7/28/2006
Rep William M.
Thomas [CA-22] - 7/28/2006
Bill Overview
The bill requires employers that offer traditional "defined benefit" plans to fully fund the plan and bring all plans up to fully-funded status within seven years. This change is likely to stimulate growth in "defined contribution" plans -- where the employer and employee invest x-amount of money into a 401(k) account. The bill allows employers to automatically enroll employees into 401(k) accounts, but it also allows employees to withdraw.
Cost Estimates
The Congressional Budget Office estimates that "[a]ltogether, these provisions would reduce revenues by an estimated $7.7 billion over the 2007-2011 period and $72.9 billion over the 2007-2016 period. JCT provided most of the revenue estimates, and its estimates are detailed in JCX-36-06, issued on July 28, 2006.
Also, see Is There A US Pension Crisis?
and bill overview from About's Guide to Taxes.
Bill Co-Sponsors
Rep Dave Camp [MI-4] - 7/28/2006
Rep John Kline [MN-2] - 7/28/2006
Rep Howard P. (Buck) McKeon [CA-25] - 7/28/2006
Rep William M.
Thomas [CA-22] - 7/28/2006
Bill Overview
The bill requires employers that offer traditional "defined benefit" plans to fully fund the plan and bring all plans up to fully-funded status within seven years. This change is likely to stimulate growth in "defined contribution" plans -- where the employer and employee invest x-amount of money into a 401(k) account. The bill allows employers to automatically enroll employees into 401(k) accounts, but it also allows employees to withdraw.
Cost Estimates
The Congressional Budget Office estimates that "[a]ltogether, these provisions would reduce revenues by an estimated $7.7 billion over the 2007-2011 period and $72.9 billion over the 2007-2016 period. JCT provided most of the revenue estimates, and its estimates are detailed in JCX-36-06, issued on July 28, 2006.
- HR 4 - Bill Text - PDF (917KB)
- Congressional Budget Office Report - July 2006 - PDF (147KB)
- Congressional Budget Office Report - August 2006 - PDF (190KB)
Also, see Is There A US Pension Crisis?
and bill overview from About's Guide to Taxes.
