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Benefit plans board continues meeting challenges

September 30, 2010 No Comment

WINNIPEG -“We felt pain over every decision,” said Dwayne Cleave of a September 22-24 Worker Benefit Plans Board of Managers (BOM) meeting. Mr. Cleave, executive director of the plans, and the five-member board spent three days in Toronto working with consultants, advisors and pension specialists to establish premium rates for 2011 and continue work on redesigning the pension plan. Every fall the board meets to review the performance of pension investments and the ongoing costs of health benefits.

The Board approved an increase to the 2011 employer contribution rates for the pension and benefit plan. Employers will receive notification of the rates in early October along with a full explanation.

Like most other pension plans, LCC’s plan is still dealing with lower than expected investment returns and historically low long-term interest rates. Both these factors have a negative impact on the pension plan’s funded position as weak investment returns mean slow asset growth and low interest rates dramatically increase pension liabilities.

“Despite these challenges, we are committed to continue finding ways to manage benefit costs which are fair to both employers and employees,” explained the executive director. He said that the board is very aware of the limited financial resources of employers—mostly congregations and schools—and that these are balanced with the overall needs of providing sufficient benefits to employees.

Joining the board for his first meeting was Rev. Don Hennig (Concordia, Edmonton). He is serving as the clergy representative. The board also welcomed as an advisor Rev. Dr. Dieter Kays, recently-retired CEO of FaithLife Financial.

With the growing complexity of plan designs and overall financial challenges, the Board of Managers passed a recommendation to LCC’s Board of Directors to increase the size of the BOM. Mr. Cleave explained that a slightly larger board would allow for greater stakeholder representation and bring to the discussions more people with specific gifts and talents related to benefit plans. If accepted, the recommendation would go from the Board of Directors to the 2011 Synodical Convention as an overture.

The Board of Managers meets again in January in Winnipeg with the goal of finalizing plans for pension redesign.

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