Retiree Pension Rep’s Report on the MTS DB Pension Plan
May 30, 2017
Retiree Pension Rep’s Report on the MTS DB Pension Plan
To TRAM Members.
The Pension Surplus Implementation Committee met on Mar. 20th, 3 days after MTS became part of Bell Canada on Mar. 17, 2017. They met to provide a status update to the committee members on the Surplus Distribution. As of Feb. 6th, the completion date there was approximately $1.35M in undistributed surplus. It should be noted that 99% of the funds have been distributed with 1% remaining which is a job well done. Approximately $157K for about 100 members must be kept in the plan in trust for Unlocated Members such as Retired Members, Beneficiaries or Deferred Members. All other Unlocated Members who are Exited Members entitlement to any Surplus is extinguished.
An additional estimated $660K to $696K more will be spent on expenses funding distribution and locating “unlocated” plan members. The committee will now deliberate how the net remaining funds will be used to provide future benefits to plan members. To that end we have asking the plan actuary what benefits/options are available/viable for the remaining funds. The next Pension Surplus Implementation Committee and Pension Committee meeting are scheduled for June 14th, 2017.
The member count of the undistributed surplus corresponds to less than 500 unlocated members (out of 9,372 members included in the settlement) meaning approximately 95% of eligible members have been located and received their surplus settlements.
Please direct Questions toll-free to 1-844-380-2474 or to e-mail address pensionsettlementquestions@mts.ca
DB Pension Committee
The Committee reports to the Audit Committee of the Board of Directors and meets twice a year. The next pension committee meeting is scheduled for June 14th, 2017 at which time we will review the Jan. 1st, 2017 Annual Valuation Reports (AVR) on the Pension plan for the year of 2016. With respect to the BELL purchase of MTS and the MTS DB Pension Plan all remains status quo.
A Funding Valuation is done at the end of each year which is required by law to determine the employer contribution to the plan. Two (2) components are looked at Going Concern – Assumes the plan will continue long term and Solvency determines the wind-up position of the plan which assumes the plan will be wound up on the evaluation date. This determines the company’s funding requirement above and beyond the normal cost for current benefits.
As at Jan. 1, 2016 there was a Going Concern surplus of 117% up from 104% the year before 13% better and a Windup or Solvency deficiency of 96% down from 88% (8%) better than the prior year which is a marked improvement. (Jan 1, 2017 - Going Concern better unofficially, Solvency up marginally.)
The Plan provides for a guaranteed COLA increase to pension payments each year. This guaranteed COLA is equal to two-thirds of the increase in CPI to a maximum CPI increase of 4%. COLA increases are granted each year in July. In 2017, retirees will receive a COLA increase of 1.00% which is two-thirds of the 2016 CPI increase of 1.5%. In 2016, retirees received a COLA increase of 1.07% which is two-thirds of the 2015 CPI increase of 1.61%.
J. Larry Trach
Retiree Representative
MTS DB Pension Committee
