Rep. Joseph Crowley, D-N.Y., said he will introduce legislationin July that would require employers with at least 10 workers tooffer a retirement savings plan.

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Crowley announced his intention today at a retirement forum onCapitol Hill hosted by the Aspen Institute’s Financial SecurityProgram. Also addressing the retirement forum were Edmund MurphyIII, president of Empower Retirement, and Rep. Jared Polis,D-Colo.

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Crowley's plan would require employers with at least 10employees that don’t already offer a plan to provide what Crowleycalled Save Up Accounts. Employers would be required to contribute50 cents for every hour worked into the account of eachemployee.

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The mandatory employer contribution would be adjusted annuallyfor inflation, Crowley said in an address to the forum.

And once enrolled, employees would automatically have 3 percentof pre-tax income deferred to the accounts, a rate Crowley saidwould also increase under the program’s design.

Employees will not have the option to opt-out of the plan,Crowley said.

In order to offset the new cost borne by small businesses,Crowley’s plan would offer tax credits worth the value of employercontributions to 10 accounts.

While employers with fewer than 10 workers would not be requiredto offer a savings plan, the tax credit would be extended to thoseemployers to encourage them to offer a plan on a voluntarybasis.

“The dream of a secure retirement is slipping away for millionsof Americans,” Crowley said in his address.

But there is a “small bright spot,” he said. “Americans want tosave, but they need the right tools.”

Looming retirement crisis

Crowley said the program would combine government oversight with“private management,” and would limit investment options to low-feeindex funds.

“These accounts will make a big difference to employees,” saidCrowley. “After 45 years of work, someone only employed in alow-wage job would have $380,000 saved up.” The savings accountswould be portable, said Crowley, who compared his proposal to theThrift Savings Plan available to federal employees.

Crowley also called for making President Obama’s MyRA retirementsaving plan permanent by codifying it into law.

The Aspen Institute’s event was held to commemorate the10th anniversary of the passage of the Pension Protection Actin 2006.

In a survey conducted by Aspen Institute leading up to theevent, nine in 10 respondents said retirement security should behigher on the agenda this political season, and two in three saidCongress should be doing more to improve the country’s overallretirement security.

Polis, the representative from Colorado, also addressed theforum, citing a $14 trillion retirement savings shortfallnationwide, calling that a “looming crisis.”

In advancing the cause of automatic enrollment and escalation,and creating target-date funds as a qualified default investmentalternative, the 2006 PPA offered “common sense solutions to realworld problems,” said Polis.

“Without the Pension Protection Act the state of affairs wouldlikely be far worse today,” he said. “We need to be here nowbecause it is time to take action again.”

In his address to the forum, Murphy of Empower Retirement,called the nation’s shift from defined benefit to definedcontribution plans a “mass investing experiment” that has beenconducted for over a generation.

“The results are in and we know what works,” Murphy said,calling PPA’s endorsement of automatic enrollment and escalationand the law’s safe harbor for sponsors “the most beneficial factorsthat lift retirement readiness.”

Murphy said assuring Social Security’s solvency should by anyretirement policy’s top priority. “We must all foster the politicalwill to make Social Security solvent,” he said.

Without Social Security, tens of millions of Americans wouldbecome destitute, and many millions more would be severelyimpacted.

“All of us who care about retirement policy should urge ourpolitical leaders to make Social Security solvency a high priority,because the system is under threat and time is not on our side,”said Murphy.

Murphy also came out in support of any federal initiative thatwould address the nation’s access gap to workplace retirementsavings plan.

“At Empower, we believe that everyone who pays mandatory FICAtax should also have the option to set aside part of their paycheckfor retirement,” he said.

“Having nearly 70 million Americans outside the definedcontribution system is a scandal,” he added.

The collective goal of lawmakers and industry stakeholdersshould be to create a retirement system that makes success easy andfailure hard, said Murphy.

“We will actively support legislative and regulatory efforts todo that through Auto-IRAs, multi-employer plans,starter or simplified 401(k)s — whatever,” he added.

Murphy called on regulators and legislators to “guide, nudge oreven mandate” automatic enrollment and escalation features in alldefined contribution plans.

An Empower representative said the firm’s longstanding positionhas been for a federal mandate for automatic enrollment with anoption for workers to opt out.