U.S. Rep. Welch demands answers from Department of Treasury, IRS

Vermont's at-large Democratic U.S. Rep. Peter Welch Thursday wrote a letter to the Treasury Department and the Internal Revenue Service demanding answers to a Wall Street Journal report revealing that some companies used employee pension plans to provide supplemental executive benefits.

Welch asked in his letter that Secretary of Treasury Henry Paulson and IRS Commissioner Douglas Shulman respond to his questions by no later than Friday, August 22, so that he "will have the information necessary to prepare a legislative response to this issue."

"At a time when workers' retirement benefits are increasingly in jeopardy and executive compensation continues to rise - too often without relation to company performance - these revelations are particularly disturbing," Welch wrote. "In short, overly generous corporate executive compensation should not be paid for at the expense of the American taxpayer or employee pension security."

The Green Mountain State's lone representative went on to list seven questions regarding the legality, the existence and adequacy of tracking and monitoring procedures of such company practices, and welcomed legislative suggestions on the issue.  

In the Wall Street Journal's August 4 article, reporters wrote that when companies engage in this behavior, it has the potential to harm lower-paid workers by destabilizing pension plans and increasing the likelihood of their failure, and further suggests that the weakening market makes the practice even riskier.