items and are hammered out in the course of negotiations. A balance is being struck constantly between direct wage adjustments, health and welfare, other fringe benefits, pensions and other items. Labor negotiators recognize the limitation of funds available for improvement of wages, hours and working conditions. Today the Pay Board imposes strict limitations. Compromise, modification, deferment and withdrawal of negotiable items characterize the bargaining process. Rising costs of maintaining a pension plan inevitably result in a diminution of other negotiable benefits or require retrogressive pension adjustments. To the extent that legislation mandates new features involving cost considerations, the parties are deprived of opportunities of improving pensions in areas to which they may attach their priority. They are forced to accept governmental prioritics. The parties may be desirous of increasing pension benefits, or adding features such as survivor benefits or death benefits. But if Congress mandates liberalized vesting, funding or requires re-insurance no consideration may feasibly be given to any item to which the parties attach priority. Legislation mandating early vesting or a funding or re-insurance has a detrimental impact on the free collective bargaining system. It imposes a government program on substantive aspects of negotiations, and because

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Statistics are quoted that a significant percentage of employees leave particular employment without having obtained any vested benefit.

Plainly a large number of employees move habitually from job to job and do not spend sufficient time in a particular plant or industry to obtain vested pension benefits. In

many instances they are employed in plants or operations which do not have any pension benefits. To complete the picture, many millions of employees from time to time are unemployed or underemployed. Admittedly, therefore, a great number of employees

will not obtain significant vested benefits because of the dynamics of the economy. standably dissatisfied with these realities are seeking to convert the private pension system into a national public pension system. Basically, the imposition of early vesting, portability, funding. and re-insurance are designed to guarantee employees pension benefits regardless of their mobility. Each employer with a pension is to become a cog in the national system. This may be, a noble and desirable ideal. But we cannot close our eyes to the reality that to achieve this objective the private pension system is being converted into a thoroughly regulated national system.

Proponents of pension reform under

While it is piously avowed that it would not be feasible or desirable for government to physically take over the private pension system and frankly convert it into a government

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operation, nevertheless, such a result will ultimately be accomplished through Senate bill $3598 and legislation of similar

character.

An area which requires congressional concern is found

in the lack of coverage.

Less than one-half of the non-farm

working population is presently covered by pensions. Necessity exists for providing sufficient incentives or other means of covering a substantial portion of the uncovered working population. If this objective were achieved, many of the problems of prime concern now to Congressional Committees would be

Overcome.

It appears wrong to impose severe pension restrictions on employers of half of the working population who operate under voluntarily adopted pensions while permitting other employe to remain completely unregulated and free of requirements relating to pensions.

Serious apprehension exists that by the imposition of the proposed legislative standards, the incentive for the establishment of private pensions will diminish significantly.

Proponents of pension reform have been led astray in regarding the private pension system as a supplement to social

Security retirement benefits. The two avetem

notwithstanding efforts to integrate them.

retirement benefits should be evaluated in terms of nat lonel

policy seeking to provide minimum retirement income for the

covered employee. Sound social policy dictates that the Social Security retirement income should be adequate to meet the basic requirements of living. If it is inadequate, it should be improved. Positive steps have been taken in the last few years in this direction. At this writing there is every indication that Social Security retirement benefits will be increased by an additional twenty percent. But it is an error to relate the inadequacy of the Social Security system as a rationale for reforming the private pensions systems. The two systems should

be viewed separately. Security, Congress does not look to the private pensions system

In providing for improvements in Social

When the Social

and the private pensions system should not be appraised in terms of the deficiencies of that system. Security system will commence paying adequate benefits, it will reduce the anxiety to convert the private pension system into

a governmental regulated program.

Existing pension disclosure is inadequate, cumbersome

and meaningless.

disclosure.

Therefore, we support a system of meaningful

But at the same time it is important that the pension administrators ought not to be subjected to an oppres

sive volume of details which will serve no purpose.

For example,

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