Sacramento, calif. (ap) - the United States California governor jerry brown said Friday signed legislation, will build the first national management retirement savings plan, the private sector workers, in opposition critics say, it creates a new taxpayer liability.
The bill will build California safe choice retirement savings plan, for more than 6 million income is low, the private sector workers, the unit of choose and employ persons does not provide retirement plans.
The program instructions employers withholding 3% of the worker's salary, unless the employee choice of savings plan, can do it every two years. It will be by the seven members of the chairman of the board by national financial management. The board of directors will choose a professional fund manager, this may be a private investment company or national public pension system, to keep the money.
Senator Kevin DE Leon, D - Los Angeles, earlier this year bill, what he called "imminent retirement tsunami", millions of low wage workers in the retirement of facing financial difficulties. He said the plan would add as a social security private sector workers to provide a portable savings plan, ensure returns.
And he said, this project is pension, but as a savings account, it may become a national model improve retirement savings.
DE Leon said in a statement: "this is in the United States a significant step towards retirement security,". "I am very grateful to the governor brown's sharp and his leadership, we set the path of the middle class industrious America going to retire, so they won't have to fall into poverty."
Senator Mimi walters, R - forest lake, known as SB1234 "the worst act, in order to make his own way in the legislation", because this will make the country's endowment insurance system mainly money spent.
Walters, points out that California public employees retirement system running in the process of the shortages and savings plan will be control of a group of "professional politician."
"SB1234 it looked like no more than a cynical efforts to shore up struggling public employee pension debt from private investors new funds," wrote in the blog walters early sign the bill.
Many city, county has with public pension system country in their donation collection, but taxpayers for public employee welfare hook if investment forecast the lip,.
This is the word is still early, what will happen, if California civil service pension fund management new retirement plan, the pension funds spokesman said, brad PaQieKe. California civil service pension fund for private sector workers can create a separate account, but it is more likely to focus investment and public sector employees.
California civil service pension fund released last year in return only 1%, long-term lack of their annual target of 7.5%. At present, its estimated $for a long time, $10 billion funding gap.
Democrats say the plan to give their employees more savings choice, especially women's work of the low paid work. Supporters say it won't take national money, because it will be backed up by the underwriter and reinsurance protection returns. DE Leon said, the money will be placed into the low risk investment, guarantee in the low interest rates and long-term Treasury bond yields of interest.
Participants must sign a liability exemption said, California loss will not take any responsibility.
The bill will not be realized unless savings plan is expected to reach ego to maintain, and exempt comply with federal regulations, including the private sector defined benefit plans. These plans must meet minimum standards, in the employee retirement income security act ".
The bill also requires the board of directors to submit annual audit. It was originally against enterprise, insurance company and financial services company. Business groups, such as the United States chamber of commerce in California falling against the change after the bill, was according to the staff.
The governor also signed SB923 companion legislation.
Republicans oppose the plan, when it was moving through the legislature said, low-income workers may be better economy, if they after-tax earnings for Ross IRA, this will let them put their donation tax exemption of retirement.
They also say that there are too many unanswered question program. Republican senator said, if the underwriter does not comply with the investment objective, the taxpayer and the employer can be used to cover losses and the management overhead is responsible for.




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