The House of Representatives last night voted to pass key amendments in H.R. 5894, or the Labor, Health, and Human Services, Education, and Related Agencies Appropriations Act, that would prevent the Department of Labor to use any allocated funds for its fiduciary proposal.
The House’s decision sparked a fiery statement from the Biden Administration, who said it “strongly opposes” the vote while blasting Republican lawmakers for not sticking with prior bipartisan negotiations under the Fiscal Responsibility Act (FRA) in May.
“House Republicans had an opportunity to engage in a productive, bipartisan appropriations process, but instead are wasting time with partisan bills that cut domestic spending to levels well below the FRA agreement and endanger critical services for the American people,” the Biden Administration wrote in its statement.
“House Republicans had an opportunity to engage in a productive, bipartisan appropriations process, but instead are wasting time with partisan bills that cut domestic spending to levels well below the FRA agreement and endanger critical services for the American people.”
The Biden Administration
The Administration added that President Biden would veto the spending bill if it reached his desk.
The House passed a separate, temporary government funding bill outside of H.R. 5894 on Tuesday, and are expected to continue their vote on the broader bill today.
H.R. 5894, or otherwise known as the Labor, Health and Human Services, Education, and Related Agencies Appropriations Act, is sponsored by Rep. Robert Aderholt (R-AL), and contains three amendments made by Republican state representatives that would deter funding to the Biden Administration’s latest proposal.
The first amendment, created by Rep. Rick Allen (R-GA), would restrict any funds made available by the legislation to be used to finalize, implement, or enforce the proposed rule or any substantially similar rule.
Another amendment by Rep. Ann Wagner (R-MO) prohibits the DOL from using funds to finalize, implement, or enforce proposed amendments to class prohibited transaction exemptions (PTEs) available to investment advice fiduciaries.
The last amendment, introduced by Rep. Ralph Norman (R-SC), would prohibit funding to carry out the actions described in the fact sheet released by the White House, which included a proposal to crack down on “junk fees” in retirement investment advice.
It’s been a whirlwind couple of days for the DOL, as the Employee Benefits Security Administration (EBSA) also confirmed today its decision to deny a request that would extend the fiduciary proposal’s comment period. A coalition of 18 financial trade groups had previously requested a 60-day extension in addition to the comment period, which is expected to conclude on January 2, 2024.
Industry reactions
The news of the House’s passage prompted responses from the insurance industry—many whom have been vocal critics on the proposed rule since its introduction on October 31.
“The U.S. House of Representatives took important action to protect the best interest of retirement savers. Amendments included in a government funding bill last night would prevent the Department of Labor from using taxpayer dollars to implement its proposed fiduciary regulation,” read a statement from The American Council of Life Insurers (ACLI), National Association of Insurance and Financial Advisors (NAIFA), Finseca, Insured Retirement Institute (IRI) and National Association for Fixed Annuities (NAFA).
The industry groups specifically took aim at the proposal’s stance on guaranteed lifetime income products, adding that it did not align with past annuity-friendly provisions seen in the SECURE Act and SECURE 2.0.
“Since 2019, Congress has passed two landmark bipartisan bills, the SECURE Act and SECURE 2.0, removing barriers to guaranteed lifetime income in workplace retirement savings plans,” the statement read. “Last night’s vote on the amendments in the House aligns with Congress’s intent to expand retirement security for all Americans…We urge the Senate to adopt these measures and protect Americans’ retirement security.”
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