Senators Question DOL Priorities on Fiduciary

A pair of Republican U.S. senators is stepping into the fiduciary rule argument. Whether their ninth-inning gambit has any impact remains to be seen.

Sens. Lamar Alexander, R-Tenn., and Johnny Isakson, R-Ga., released statements recently criticizing the Department of Labor. The department’s fiduciary rule is expected to be published any day now and take effect by the end of 2016.

Opponents are waging a last-ditch effort to block the rule, and Republican lawmakers are listening. Alexander and Isakson weighed in on a research request that was posted by the Department of Labor in the Federal Register last week.

The DOL is soliciting comment on a study to collect data “on how people make … decisions related to retirement.” The senators seized on the timing of the DOL's seeking retirement advice just as the department readies a fiduciary rule the senators say will limit small savers access to that advice.

“It is appalling that, by its own admission, the Department of Labor does not know enough about how individuals and families make retirement decisions, yet the Obama administration is still willing to move forward with implementation of a fiduciary rulemaking,” Isakson said. “This rule would limit access to investment advice for the families who need it most.”

The study, announced in late February, is a multi-year survey of how workers and households save, said DOL Spokesman Michael Trupo, and will “deepen the department’s understanding” of the ever-evolving retirement investment marketplace.

“To suggest that building upon our already robust body of retirement research in some way diminishes the validity of our efforts to reduce conflicts of interest in retirement advice is simply disingenuous,” Trupo added in a statement. “To suggest that more study is needed before addressing a well-documented problem that costs workers many billions of dollars each year is troubling, to say the least.”

Isakson chairs the Senate Health, Education, Labor and Pensions Subcommittee on Employment and Workplace Safety. Last month, he introduced the Affordable Retirement Advice Protection Act that would require a vote by Congress before any final fiduciary rule by the administration goes into effect.

Alexander, chairman of the Senate Labor Committee, called on the Obama administration to withdraw the fiduciary rule. That is unlikely to happen since the president has made passing the rule a priority before he leaves office in January 2017.

“The Labor Department’s request suggests it is blindly moving forward with policy that has the potential to cut off access to affordable retirement advice for millions of Americans and their families,” Alexander said. “Republicans will consider what options are necessary to help hard-working Americans planning for their future.”

InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected].

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.