The House Ways and Means Committee today approved a bill that seeks to make it easier for companies to offer investment advice to 401(k) participants.
The bill, known as the Retirement Security Advice Act, was approved by the committee in a 25-15 vote. Two Democrats, John Tanner of Tennessee and Richard Newal of Massachusetts, voted in favor of the bill. A statement released by the bills supporters said that other Democrats, including Earl Pomeroy of North Dakota and Benjamin Cardin of Maryland, said they favored the bill in principle, but wanted to revise it before it reached the full House.
Early last month the Education and the Workforce Committee, which is chaired by the bills author, John Boehner (R-Ohio), approved the legislation. The "Boehner Bill," as it is known, now moves to the House floor for consideration.
Todays vote follows the bills endorsement yesterday by Treasury Secretary Paul ONeill, who said in a statement that "the expansion of available investment advice is critical" at a time when an increasing number of companies are participating in 401(k) programs.
Supporters say the bill would clarify federal regulations under the 1974 Employee Retirement Income Security Act (ERISA) and make it easier for companies to offer advice to retirement investors. Opponents say the bill would pose a conflict of interest for fund companies, who could steer investors toward products that yield higher revenues.