Retirement Income Data:

Improvements Could Better Support Analysis of Future Retirees' Prospects

GAO-03-337: Published: Mar 21, 2003. Publicly Released: Mar 21, 2003.

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Future demographic trends include a doubling of the nation's retiree population and only modest labor force growth, leading to concerns about retirement income adequacy for future generations. Credible projections of the effects of policy proposals on federal spending and future retirees' income are necessary. Because adequate data is critical to the analysis of retirement income and wealth, GAO was asked to identify data improvements that experts say are a priority for the study of retirement income and wealth, as well as factors limiting efforts to obtain the needed information.

Experts consulted by GAO cited priorities for improving retirement data that fit into two broad categories: (1) obtaining better data from employers on employee benefits and (2) obtaining better data by linking more individual and household surveys with administrative data (such as employer records, and Social Security earnings history records). Information from employers, such as documents describing the features of their pension plans, would enable analysts to forecast future retirement income of pension holders, based on the specific features of their pension plans and the likely distribution of pension income and wealth for different segments of the population. Linking individual and household surveys with administrative data creates new information, such as the demographic characteristics of employees whose pensions are affected by the formulas that employers use to calculate contributions or pension payments. Analysts attribute the shortcomings in retirement income data primarily to fragmentation of the responsibility for data collection and analysis, the burden of data collection on respondents, and confidentiality considerations that restrict access to these data. Fragmentation of responsibility occurs, in their view, because no single agency has a statutory mandate to collect or to analyze all the data needed to support a more comprehensive study of retirement income and wealth. With regard to respondent burden, some information on pension plans is no longer collected, in part, out of concern that it was an unnecessary burden on the firms having to submit it. Finally, certain kinds of data needed to make projections are not widely available to all analysts because of the confidentiality laws that authorize their collection.

Status Legend:

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  • Review Pending-GAO has not yet assessed implementation status.
  • Open-Actions to satisfy the intent of the recommendation have not been taken or are being planned, or actions that partially satisfy the intent of the recommendation have been taken.
  • Closed-implemented-Actions that satisfy the intent of the recommendation have been taken.
  • Closed-not implemented-While the intent of the recommendation has not been satisfied, time or circumstances have rendered the recommendation invalid.
    • Review Pending
    • Open
    • Closed - implemented
    • Closed - not implemented

    Matter for Congressional Consideration

    Matter: To facilitate plan participants', beneficiaries', and analysts' timely access to information about employer-provided pension plans, Congress may wish to consider directing the Secretary of Labor to obtain from plan administrators electronic filings of all summary plan descriptions (SPD) and summaries of material modifications required by the Employee Retirement Income Security Act of 1974 and make them publicly available in electronic form.

    Status: Closed - Not Implemented

    Comments: No congressional action has been taken that calls for electronic filing or public availability of summary plan descriptions.

    Recommendations for Executive Action

    Recommendation: To help analysts improve analyses of retirement plan finances, IRS should publish on an annual basis aggregate tabulations, such as those prepared in the Statistics of Income Bulletin, of information filed on IRS Forms 5498, 1099-R, and W-2.

    Agency Affected: Department of the Treasury: Internal Revenue Service

    Status: Closed - Implemented

    Comments: A second tabulation of these data appeared in an article in the Spring 2006 issue of the "Statistics of Income Bulletin." The previous tabulations, published in the Spring 2004 issue, covered tax year 2000. This more recent article covered tax years 2001 and 2002.

    Recommendation: For plans in place before these new filing requirements go into effect, and where it is cost-effective, the Secretary of Labor should use existing authority to obtain copies of summary plan descriptions and summaries of material modifications in cases where analysts working on federally conducted or federally sponsored research seek SPDs for statistical purposes. This should assist analysts of retirement income in obtaining information about the features of employer-sponsored benefit plans that are not electronically available.

    Agency Affected: Congress

    Status: Closed - Implemented

    Comments: The Department of Labor (DOL) will address requests for summary plan descriptions (SPDs) from people who are not plan participants or beneficiaries on a case-by-case basis. This will help analysts of retirement income obtain information about the features of employer-sponsored benefits plans that are not electronically available.

    Recommendation: To help provide the data needed to inform important policy decisions concerning retirement programs, the Secretary of Labor should direct the Bureau of Labor Statistics to prepare a plan to improve data for analyzing retirement income and wealth in coordination with the Office of Management and Budget (OMB), the Federal Reserve Board, the Internal Revenue Service (IRS), and the agencies represented in the Federal Interagency Forum on Aging Related Statistics, including the Census Bureau, the Social Security Administration (SSA), and the National Institute on Aging. The plan should include cost-effective strategies to (1) make better use of existing statistics by linking survey and administrative data; (2) improve access to linked data consistent with privacy and confidentiality legislation; and (3) improve data collected from employers related to retirement income and wealth.

    Agency Affected: Department of Labor

    Status: Closed - Not Implemented

    Comments: Labor continues to state that it would not act on this recommendation. The Bureau of Labor Statistics (BLS) indicated that, while BLS does not believe it is the appropriate agency to lead the effort, BLS would participate in the effort to improve data for analyzing retirement income and wealth.

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