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Compliance July 18, 2008
House Panel OKs Auto Enrolling New Fed Workers
A House Committee approved a measure to auto enroll new federal workers in the Thrift Savings Plan with a 3% deferral.
Reported by Fred Schneyer
The bill approved by the House Oversight and Government Reform Committee would also designate the TSP’s Government Securities Fund, known as the G Fund, as the default investment option. As is typically the case in auto enrollment, federal workers would have the opportunity to opt out of the plan.
Chairman Henry Waxman (D-California) sponsored the Thrift Savings Plan Enhancement Act (H.R. 6500), which also provides for a Roth IRA option within the TSP and gives the Federal Retirement Investment Board the authority to add new investment options without additional Congressional approval.
Some board members have contended they would prefer the historical checks-and-balances arrangement with required prior approval by Congress.
In addition, the measure would require the TSP to include a Roth Individual Retirement Account option.
At a June 30 joint meeting of the board and the Employee Thrift Advisory Council (ETAC), participants expressed support for automatic enrollment of new federal employees into the TSP.