TO ALL IAMAW MEMBERS
AIR CANADA RETIREES
PENSION COMMITTEE RETIREMENT REPRESENTATIVE REPORT – JANUARY 2016
Dear Retired Brothers and Sisters:
I hope the New Year finds you in good health, good humour and either planning or in the middle of a trip to warmer climes, to enjoy your retirement.
Effective January 1, 2014, all Members of the IAMAW, working for Air Canada, were transferred into one, stand alone Pension Plan. The Plan Membership included all IAMAW active, retired and deferred employees of Air Canada and CAIL. This was a massive undertaking and it was not until June 2015 that all of the assets, liabilities and Membership data were finalized, with regard to this transfer. The federal regulators (OSFI), Plan actuaries (Hewitt) and Air Canada Pension Department all had major roles in this massive undertaking. Air Canada has now done this with all of the different Unions. This stand-alone IAM Pension Plan better enables us to oversee and monitor the performance of our pension assets and liabilities going forward. This change to the new IAM Pension Plan was done solely to allow for better administration and oversight of our Pension Plan and does not affect the benefits of any Member, in any way.
At the time of the transfer to our new IAM Plan, there were approximately 20,000 Members in this amalgamated Plan. This number includes 9,000 retirees, 2,000 surviving spouses, 900 deferred pensioners and 8,000 active Members. Because of changes negotiated in 2012, no new Members will be entering this Plan. As time moves on, the demographics of the group will continue to age. We are currently fully funded and if the actuaries have done their job correctly, we will continue to be so until the last surviving Member receives their last pension payment.
The net assets of the IAM Plan are approximately $5,000,000,000. That is approximately 30% of the entire Air Canada Pension Fund ($16B). The combination of changes made to the Plan rules, above average return on investments and the fully implemented new investment policy, have resulted in a surplus position for the past two (2) years. There is confidence these changes will be sufficient to keep the Plan on solid financial footing, even during this extended period of record low interest rates. It will be a few months before investment returns for 2015 will be published, but it is expected that they will not be nearly as high as they were in 2014 (22%).
Please sit back and enjoy those monthly pension cheques because you worked hard for them. The Pension Committee will do their best to ensure that they keep coming.
If any retired Members have any questions, problems or comments regarding the Pension Plan, they are encouraged to contact me, by email at retirees@iam140.ca. I will do my best to get back to Members in a timely fashion and provide information and assistance, as required.
Respectfully submitted,
Ed Wainwright
Retiree Pension Representative
IAMAW / AIR CANADA
BULLETIN NO. 006 – ISSUED JANUARY 25, 2016
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