The 2012 presidential campaign comes at a turning point in the debate over the government's role in employee benefits, from a shifting landscape in retirement plans to universal health care.
Organizations representing those interests are keenly watching where the candidates stand on the issues. With the candidates' starkly contrasting views, the 2012 campaign season promises to be anything but dull.
Recently, 11 organizations representing employee benefits professionals submitted questions to President Barack Obama and Republican challenger Mitt Romney in an effort coordinated since 1984 by Sam Gilbert, president of The Pension Forum and of United Plan Administrators. The Westlake Village, Calif., firm consults on small-business retirement plans.
In addition to Pensions & Investments and the Pension Forum, the organizations were the American Society of Pension Professionals & Actuaries; American Academy of Actuaries; Employers Council on Flexible Compensation; U.S. Chamber of Commerce; Society of Professional Benefit Administrators; National Institute of Pension Administrators; Plan Sponsor Council of America; and Small Business Council of America.
The question of tax reform, and specifically the tax preference for retirement savings, was among the top concerns of the organizations.
Both candidates are under the gun to fix the economy and to get a massive federal budget deficit under control. As a result, long-standing tax incentives for retirement savings are in the cross hairs of revenue hunters, and the groups want to remind the candidates — repeatedly — that the tax deferrals for retirement savings should be off the table because they are not outright deductions.
“It would be really shortsighted and ill-considered to view that as a short-term way to raise revenue,” said Judy Miller, director of retirement policy for the Arlington, Va.-based ASPPA, “My question is: Do they understand that?”
The groups also want to know what the next president will do to encourage employers to keep offering retirement plans.
“The bottom line is that it is much more than a tax treatment,” said Edward Ferrigno, PSCA vice president of Washington affairs. “You've got both sides talking about capping contributions, but they have to understand what the impact will be on plan sponsorship and the societal impact if it reduces sponsorship.” The PSCA's question is: “The evidence is overwhelming that the single most important factor in amassing retirement assets is whether or not an employer offers a retirement plan to employees. What will you do to encourage (that)?”
The U.S. Chamber of Commerce in Washington, suggested a good way to encourage plan sponsors is to ensure that the Obama administration's emphasis on government efficiency is also encouraged among employers, who want electronic delivery of benefit plan disclosures, and fewer regulatory hurdles.
