The Department of Labor’s controversial Retirement Security Rule—commonly referred to as the fiduciary rule—faces more opposition today in the wake of a pair of votes this afternoon by two separate committees within the House of Representatives.
Late today the House Appropriations Committee approved by a 31-25 vote the Fiscal Year 2025 Labor, Health and Human Services, Education, and Related Agencies bill, which contains policy riders that would prevent the DOL from spending money to administer, implement, or enforce several regulations, including the Retirement Security rule and three related rules involving prohibited transaction exemptions.
Slightly earlier this afternoon, the House Education and the Workforce Committee voted 23-18 to report a bill (H.J. Res 142) to the House floor that would disapprove the DOL’s fiduciary rule. The resolution was sponsored by Rep. Rick Allen (R-GA) and has 31 cosponsors.
In reporting on the vote, vocal fiduciary rule opponent the Insured Retirement Institute noted there is no indication yet on when the House will consider this measure.
The House committee’s vote today on the Congressional Review Act (CRA) resolution to disapprove the DOL’s controversial fiduciary rule is a law that authorizes Congress to review final adopted federal agency rules. If a CRA joint resolution of disapproval is approved by both houses of Congress and signed by the President, the rule at issue cannot go into effect or continue in effect.
Even if both the Republican-controlled House and Democrat-controlled Senate were to approve the CRA joint resolution of disapproval, getting President Biden to sign a resolution to kill one of his policy initiatives is extremely unlikely.
IRI supported passage of the resolution and urged Committee members to vote to advance the measure to the House floor.
“This rule improperly and unnecessarily expands ‘fiduciary’ status to nearly all financial professionals who provide retirement guidance and imposes substantial new barriers that will impede consumer access to accurate information about retirement products,” said Wayne Chopus, President and CEO of IRI. “It is substantially similar to the ill-advised 2016 rule and will have a similar negative impact on low- and middle-income workers. In its rush to adopt this rule, the DOL ignored sound evidence of its harmful effects as well as the actions taken by federal and state regulators since 2020 to enhance the regulation of financial professionals.”
Chopus also offered a comment on the afternoon’s second vote of consequence for the fiduciary rule, saying IRI supports the measure and will work to educate House members to support it when the bill is considered on the House floor, which is expected in the coming weeks.
“The House Appropriations Committee voted to protect consumers today by approving legislation that includes a provision prohibiting the Department of Labor from spending federal funds to administer, implement, or enforce its harmful fiduciary rule,” Chopus said. “IRI will continue to advocate against this rule, which inhibits consumers’ access to much-needed financial information and guidance to effectively plan for retirement.”
Coalition applauds committee moves
The American Council of Life Insurers (ACLI), National Association of Insurance and Financial Advisors (NAIFA), Finseca, National Association for Fixed Annuities (NAFA) and IRI issued a statement of support for the legislation passed today by the two committees. It said:
“The actions taken today by the U.S. House Appropriations Committee and the Education and the Workforce Committee send a clear message that the Labor Department’s fiduciary-only regulation does not align with Congress’s efforts to expand retirement security for all Americans through the increased availability of lifetime income options.
“In 2019 and 2022, Congress reaffirmed the importance of lifetime income when it passed legislation making it easier for employers to include annuities in workplace retirement plans. The fiduciary-only regulation is at odds with this progress. It restricts consumer access to professional financial guidance and options for protected lifetime income that annuities offer.
“These products and services are needed now more than ever, with 30.4 million Americans turning age 65 between 2024 and 2030. Most of these individuals will not have a defined benefit pension that provides a regular monthly income in retirement.
“The Appropriations Committee bill would deny the Department of Labor funding to administer, implement or enforce its ill-advised fiduciary-only regulation. The House Education and the Workforce Committee measure would prevent the regulation from taking effect.
“We applaud both committees for their actions on behalf of America’s retirement savers.”
Currently, the DOL’s Retirement Security Rule is scheduled to become effective in September.
EDITOR’S NOTE: This article has been updated to include the insurance coalition statement above.
SEE ALSO:
• House Committee Vote to ‘Stop Biden’s Fiduciary Rule’ Set for Wednesday
• Fiduciary Rule Fate Clouds in Wake of SCOTUS Chevron Doctrine Ruling
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.