More retirement-related regulatory news for plan sponsors, including links to detailed information.
PBGC releases FY2014 projections report
The projected insolvency date for the insurance program for multiemployer pension plans, which cover more than 10 million Americans, has been delayed by three years, according to the FY 2014 projections report released by the Pension Benefit Guaranty Corporation. The risk of program insolvency has decreased over the near term due primarily to the new premium revenues anticipated under the Multiemployer Pension Reform Act of 2014 (MPRA). It is more likely than not that the program’s assets will be depleted in 2025, compared with 2022 in last year’s report, and the risk of insolvency grows rapidly thereafter.
Projections for the PBGC’s insurance program for single-employer plans, which cover about 31 million people, show that the program’s financial condition continues to be likely to improve and conclude that it is highly unlikely to run out of funds in the next 10 years. PBGC modeled 5,000 simulations for the 2014 Projections Report, and none showed that the program would be unable to pay the benefits it owes in 2025.
To read the PBGC’s entire projections report, click here.
JCT provides background on proposed fiduciary rule
The Joint Committee on Taxation has released a report explaining information regarding the Department of Labor’s proposed fiduciary rule. The document provides a description of present law relating to prohibited transactions, investment advice, and fiduciary status with respect to retirement plans and individual accounts.
To read the entire report (JCX-131-15), click here.
GAO report on pension advance transactions
The Government Accountability Office (GAO) have released a report entitled “Pension advance transactions – questionable business practices and the federal response” (GAO-15-846T). The report is based on testimony provided by Stephen Lord, managing director, forensic audits and investigative service at the GAO, before the Senate Special Committee on Aging. The testimony examines companies attempting to take advantage of retirees using pension advances. The report describes the number and characteristics of pension advance companies and marketing practices; evaluates how pension advance terms compare with those of other products; and evaluates the extent to which there is federal oversight.
To read the entire report, click here.