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Compliance October 2, 2007
House Panel Sets Hearing on Miller Fee Disclosure Bill
The U.S. House Education and Labor Committee will hold a hearing Thursday to discuss a proposal requiring greater 401(k) fee disclosure by plan sponsors and providers.
Reported by Adrien Martin
The 401(k) Fair Disclosure for Retirement Security Act of 2007 was proposed by Representative George Miller (D-California), the committee’s chairman, in July (See Fee Disclosure Legislation Introduced in House). At a committee meeting in March, Miller said that workers are “simply not in a position to compare plans” and that improving “401(k) transparency is just the beginning of our efforts to ensure that all American have access to a secure retirement.”
Pension industry groups soon weighed in, most of which criticized Miller’s plan as burdensome on plan sponsors with too little real benefit to plan participants, some even arguing that too much disclosure could actually thwart retirement savings efforts.
A SPARK Institute analysismost recently suggested that fee information is arguably not the most important point participants should consider when they are making investment decisions and also suggested that an over-emphasis on fees and expenses could actually lead to poor investment decisions (See SPARK Says Fee Disclosure Proposal Too Burdensome).