By Jerry Geisel
WASHINGTON — An effort by a U.S. senator to develop a consensus between employers and participant groups on cash balance plan rules has so far not produced any tangible result, with one major employer group already pulling out of the talks.
Washington pension observers have written off this year as providing any chance for Congress to act on cash balance plan legislation, as legislators focus on other issues in the remaining few weeks of the session.
"It is virtually certain there will be nothing this year," said Ron Gebhardtsbauer, senior pension fellow at the American Academy of Actuaries in Washington.
In March, Sen. Tom Harkin, D-Iowa, invited employer and participant groups to meet to try to find a common ground and end the legal uncertainty that has enveloped cash balance plan conversions.
Mr. Harkin said the debate over cash balance plans had reached a "critical point," adding that he wanted ideas from a variety of interest groups, "so that we might seize this moment together" and resolve apparent conflicts.
The failure to adopt sensible policy requirements for plan conversions would increase the likelihood that employers would freeze or terminate defined benefit plans and offer only defined contribution plans, he said.