PBGC Report Points to a Retirement System Solution that Already Exists

By Tom Hawkins | October 12, 2026

The Pension Benefit Guaranty Corporation’s September 2026 report, Feasibility of Expanding PBGC’s Missing Participants Program, deserves considerable praise for both the rigor of its analysis and the clarity of its conclusions.

Rather than simply endorsing the concept of a government-run retirement clearinghouse, a PBGC team carefully evaluated the operational, technological, and policy realities involved and ultimately reached the conclusion that expanding the existing PBGC Missing Participants Program into a large-scale consolidator of inactive retirement accounts would require an entirely new infrastructure and would not be feasible through simple expansion of the current program.

Perhaps most importantly, the PBGC’s report observes that significant private-sector innovation is already underway. Although not mentioned by the name, the report clearly describes Retirement Clearinghouse (RCH), the Portability Services Network (PSN) and auto portability, implicitly acknowledging the reality that the private sector has moved beyond theoretical discussions and has begun building the infrastructure necessary to create a connected retirement ecosystem.

Why the PBGC Report Was Written
In 2023, the Governmental Accountability Office (GAO) issued a report (GAO-24-103577) examining opportunities to reduce retirement plan leakage and improve retirement account portability.

In that report, GAO recommended that the PBGC evaluate whether its Missing Participants Program could be expanded to serve as a central consolidator for small inactive 401(k) accounts and report its findings to Congress. The PBGC report was written in response to that recommendation.

What the Report Found
In their report, the PBGC reached the following conclusions:

1. The current Missing Participants Program cannot simply be expanded to become a national consolidator.
2. A completely redesigned and automated program would be required.
3. Significant new resources, systems, and funding would be necessary.
4. Were a federal initiative to be undertaken, the PBGC is not the best entity to perform this role, given its focus on defined benefit plans and limited experience with ongoing defined contribution plan administration.
5. Congress should consider the roles of private-sector solutions before assigning this responsibility to the PBGC.

The report also includes a section on “Private Sector Initiatives” that describes the auto portability model associated with RCH and PSN, without naming the organizations.

A Problem Long in Search of a Solution
The challenge is undeniable.

Americans change jobs frequently throughout their careers. Each transition creates the possibility that their defined contribution retirement savings will be left behind in a former employer’s plan, transferred to a safe harbor IRA, or cashed out altogether. According to EBRI research, retirement leakage amounts to over $90 billion annually, undermining long-term retirement security and disproportionately affecting lower-balance savers.

Meanwhile, account fragmentation is a defining feature of our retirement system, while other financial sectors solved similar interoperability challenges decades ago. Consumers routinely transfer securities through ACATS. Banks exchange funds through highly automated networks. Electronic payment systems move trillions of dollars every day. By comparison, plan-to-plan retirement transfers remain the domain of manual reviews, proprietary forms, paper checks, and institution-specific procedures.

Recently, the Department of the Treasury was required by provisions of the SECURE 2.0 Act to provide guidance “in the form of sample forms….to simplify, standardize, facilitate, and expedite the completion of rollovers to eligible retirement plans and trustee-to-trustee transfers from individual retirement plans.”

In response, the Treasury issued IRS Notice 2026-49, which proposed four voluntary model forms and a five-step process designed to facilitate communication between distributing and receiving plans.

While the Treasury's findings were a welcome and constructive development, the whole idea of streamlining a vast system via forms standardization seems a bit rudimentary when compared to automated solutions.

The Private Sector Has Already Built the Infrastructure
In any event, the retirement industry has quietly been building and operating practical solutions to solve the portability conundrum.

Auto portability represents a fundamentally different approach from a government-held repository of retirement assets. Rather than collecting and warehousing inactive accounts indefinitely, the network identifies a participant’s active account with a new employer and proactively transfers assets directly into that account. Savings remain in the employer-sponsored retirement system where they can continue to grow on a tax-deferred basis, benefit from institutional pricing, and remain connected to an engaged participant.

As described in this recent article by RCH & PSN CEO Spencer Williams, the key innovation lies in creating what amounts to a true retirement clearinghouse infrastructure: a many-to-many network capable of connecting numerous plans and recordkeepers through shared standards and technology. Rather than functioning as a destination, a digital clearinghouse serves as a conduit, moving retirement assets to where they belong.

As of this writing, auto portability has already been adopted by more than 23,000 retirement plans that represent 7.7 million active participants nationwide, demonstrating that retirement-industry clearinghouse technology can operate successfully at a significant scale.

The Next Step: A Broader Clearinghouse Network
Beyond auto portability, the larger opportunity is the creation of a broader digital infrastructure that can locate, validate, and move retirement assets across institutions using common standards and interoperable technology.

That vision was articulated more comprehensively in RCH’s 2026 blueprint for expanding clearinghouse services across the retirement ecosystem. The concept envisions a retirement system supported by shared digital infrastructure capable of addressing multiple use cases beyond automatic portability, including missing participant searches, the Saver’s Match program, rollover facilitation, and future innovations that may emerge as the system continues to evolve.

A Valuable Roadmap for Policymakers
The PBGC should be commended for their report, which recognizes both the magnitude of the fragmentation problem and the operational realities involved in addressing it. It also acknowledges the substantial innovation already occurring in the private sector.

As policymakers consider the future of retirement-system modernization, the PBGC’s report provides a valuable point of reference. Rather than creating a new clearinghouse function from scratch, Congress and regulatory authorities should look carefully at the progress already being made within the private sector and explore how public policy can support, encourage, and accelerate the development of a comprehensive clearinghouse network that keeps workers connected to their savings throughout their careers.