Back in the day, pre-ERISA day, many retirement plans had “bad boy” clauses. That is, a provision in the plan under which a participant could forfeit all benefits for being a “bad boy.” That usually meant among other misdeeds criminal conduct. Well, they’re back – at least as far as Congress is concerned. Last November, a diverse coalition of 23 citizen groups led by the 350,000-member National Taxpayers Union (NTU) sent a letter to House Speaker-Elect Nancy Pelosi and Senate Majority Leader-Elect Harry Reid urging them to support a bill that would eliminate the practice of allowing convicted lawmakers to draw taxpayer-subsidized retirement benefits.
At that time, no member of Congress was required to forfeit a pension unless convicted of crimes related to treason and espionage. The NTU noted that as a result, over the past 25 years at least 20 lawmakers guilty of other serious offenses have enjoyed Congressional retirement payments. The NTU also noted that congressional pension benefits are two to three times more generous than those normally offered to similarly paid private-sector workers, and even exceed the standard for most federal executives. There is also a lucrative, supplemental 401(k)-style plan.
The bill never passed. Now new Congress, new politics. Today by a vote of 431-0 the House of Representatives passed a bill that lawmakers convicted of crimes such as bribery, fraud and perjury will be stripped of their congressional pensions. The bill must be reconciled with the Senate bill approved last week as part of larger ethics and lobbying reform before the measure can be signed into law. Only minor differences exist between the House and Senate versions.
And what about those 20 lawmakers referred to above who were convicted of crimes and may be collecting benefits? They’re exempt because both versions of the bill are not retroactive. Surprised?