Early Retirement Incentive Benefit Your Offer and Next Steps December What is the Early Retirement Incentive Benefit (ERIB)?...

Transcription

1 December 2013

2 Early Retirement Incentive Benefit Your Offer and Next Steps December 2013 Table of Contents What is the Early Retirement Incentive Benefit (ERIB)?... 2 Your ERIB Lump Sum Offer... 2 Is ERIB right for you?... 2 What happens if I accept the ERIB Offer?... 2 What happens if I want to decline the ERIB Offer?... 2 How long does the ERIB process take? You Receive your ERIB Offer You Receive a Retirement Application Package Review your ERIB Offer and Retirement Application Package Notify HBT of your Decision to Accept the Lump Sum Payment Offer HBT Coordinates the Early Retirement Process and Payment Your Retirement Income Starts You Can Expect to Receive... 4 Some Questions You May Have... 5 Contact List and Resources... 7 HEALTHCARE BENEFIT TRUST 1

3 Early Retirement Incentive Benefit Your Offer and Next Steps December 2013 What is the Early Retirement Incentive Benefit (ERIB)? ERIB is a voluntary program under your collective agreement that allows eligible employees to retire early and receive a lump sum payment to make up for expected pension income lost as a result of retiring prior to age 65. Your ERIB Lump Sum Offer You have received this package because you are eligible to receive the ERIB benefit. This package outlines the process and the amount of the ERIB lump sum you will receive, if you choose to accept ERIB and retire early. The details of how the ERIB lump sum calculation is completed and your pension income estimate are outlined in your offer letter. If you have questions about the calculation and your lump sum offer, please contact HBT at erib@hbt.ca or (toll-free ). Is ERIB right for you? Retiring early may be right for some people and may not be right for others. The following steps are recommended to assist in your decision making about your offer and early retirement: 1. Review you offer. 2. Review the guide: ERIB Factors to Consider & Recommended Checklist. 3. Review the Retirement Application Package from your pension plan. 4. Discuss your offer, Detailed Calculation Guide and ERIB Factors to Consider & Recommended Checklist with a financial advisor. A list of contacts is provided on page 7 to address some of the questions you may have. What happens if I accept the ERIB Offer? You will resign from your employment. You will retire early. Your LTD benefit from Great-West Life (GWL) will stop. Your pension income will start. You will receive the lump sum presented in your ERIB offer. What happens if I want to decline the ERIB Offer? Your LTD benefit will continue up to age 65, provided you meet the definition of disability. Notify HBT that you want to decline the ERIB offer. Call: or You may be contacted by HBT in the future regarding your eligibility for ERIB. HEALTHCARE BENEFIT TRUST 2

4 Early Retirement Incentive Benefit Your Offer and Next Steps December 2013 How long does the ERIB process take? Your ERIB offer and early retirement will be processed once HBT receives your completed application package. HBT will coordinate the retirement process for you by notifying all necessary parties of your decision. A detailed outline of the ERIB process follows: Employee receives offer from HBT. Employee receives Retirement Application Package from BC Pension Corporation. Employee notifies HBT of decision and submits completed forms. HBT sends notification of early retirement to: Great-West Life Your Employer (who will notify BC Pension Corporation) Retirement Date Pension Income Starts LTD Income Stops ERIB Lump Sum Payment Received 1. You Receive your ERIB Offer Your offer advises you that you are eligible for ERIB and lets you know the amount of the lump sum payable to you under ERIB. The package also includes the forms you need to complete and mail if you decide to accept the offer. 2. You Receive a Retirement Application Package Approximately 2 weeks after you receive your ERIB offer you will receive a Retirement Application Package from BC Pension Corporation (MPP or PSPP). It will include your pension estimate, options and all forms required to complete your pension application, should you choose to retire early. 3. Review your ERIB Offer and Retirement Application Package It is recommended that you return your ERIB application to HBT within 6 weeks of your offer date. If you need more time to review with a financial advisor or to make your decision, please contact HBT as soon as possible. Depending on the length of additional time you need, HBT may have to revise the calculations in your offer and your projected retirement date due to processing times required by your pension plan. See page 7 for contact information. 4. Notify HBT of your Decision to Accept the Lump Sum Payment Offer If you decide to accept the lump sum payment offer, you must complete and submit forms to HBT and BC Pension Corporation. a) Complete HBT s four coloured forms and return in the envelope provided: i. Application: LTD Early Retirement Incentive Benefit (ERIB) (blue) ii. Notice of Retirement (purple) iii. Payment Options (yellow) iv. Agreement and Release (green) b) Complete the forms in the Retirement Application Package from BC Pension Corporation and return in the envelope provided. HEALTHCARE BENEFIT TRUST 3

5 Early Retirement Incentive Benefit Your Offer and Next Steps December HBT Coordinates the Early Retirement Process and Payment Once HBT and BC Pension Corporation receive your completed forms, your early retirement will be processed as follows: a) HBT will notify your employer to process your early retirement. HBT notifies your employer that you have accepted your ERIB offer and provides a copy of your signed Notice of Retirement. Your employer will then complete and submit the required pension forms to BC Pension Corporation to process your pension. b) HBT will notify Great-West Life (GWL) to terminate your LTD benefit. HBT notifies GWL to terminate your LTD benefits at your retirement date. GWL will then send you a letter confirming your LTD will cease on your retirement date. c) HBT will confirm with BC Pension Corporation that your pension application has been processed. HBT will contact BC Pension Corporation to confirm that they have processed your pension application. At that point, a cheque will be processed for the payment amount indicated. 6. Your Retirement Income Starts Your retirement date would be the last day of the month in which you choose to retire. Your pension goes into effect on the first of the month, following your retirement date. Your LTD income will continue until the end of the month in which you retire, on a prorated basis. You will not receive LTD income in subsequent months. 7. You Can Expect to Receive Last LTD payment. First pension payment, 30 days after your pension effective date. Lump sum ERIB payment, 30 days after your pension effective date. T4A for the applicable tax year of the payment(s), by the required distribution date (February). Any subsequent T4As and T5s if you decide to defer any portion of the lump sum ERIB payment at the required distribution date in subsequent tax years. HEALTHCARE BENEFIT TRUST 4

6 Early Retirement Incentive Benefit Your Offer and Next Steps December 2013 Some Questions You May Have 1. Will my pension income be reduced if I retire early? Your pension may be reduced if you retire early. You will receive the ERIB lump sum payment to make up for expected income reductions due to early retirement. See ERIB Lump Sum Detailed Calculation Guide for more information. 2. How long does the reduction in my pension for early retirement last? The early retirement pension reduction affects your monthly pension for as long as you or your survivor collects your pension. The lump sum you will receive under the ERIB is expected to make up for this reduction for the entire period. 3. Can I work after I retire? Yes. You should contact your pension plan for information about employment. See page 7 for contact information. If you are receiving a CPP Disability Benefit you should contact Human Resources Development Canada for more information about employment. Toll-free: You may also want to speak with your employer or union representative. 4. Who receives the lump sum payment? You do. The lump sum payment is paid directly to you by HBT. You may choose to receive the lump sum over one, two or three years. 5. Is my lump sum payment taxable? Yes. Your payment is taxable. The amount is only payable to you and it cannot be transferred into an RRSP. It is advisable that you speak with a financial advisor regarding tax options that may be available to you. 6. Can I use some of the lump sum incentive to buy back pensionable service while I was on LTD? Contact your pension plan to determine if this is an option for you. See page 7 for contact information. 7. Who should I contact for more information about my pension? Can I purchase health benefits through my pension plan? Contact your pension plan. See page 7 for contact information. HEALTHCARE BENEFIT TRUST 5

7 Early Retirement Incentive Benefit Your Offer and Next Steps December Am I eligible for continued Extended Health benefits if I go on pension? Yes. You may be entitled to continue to receive extended health benefits through your employer on a 50/50 cost share basis, until age 65. Contact your employer or union representative for further details about your entitlement to health benefits. If you do not want to receive health benefits through your employer, you can contact your pension provider for more information about benefits available to you. See page 7 for contact information. 9. Are extended health benefits available to me if I retire in another province? Yes. Please contact your employer or your pension provider about health benefits available to you if you currently reside in another province or plan to move out of province. See page 7 for contact information. 10. What happens to my deferred lump sum payment(s) if I die before receiving the full amount? The balance of the lump sum will be paid to your estate. 11. When will I get my last LTD payment? Depending on your LTD payment schedule, you will receive the last full month s payment on your regular pay date. For any days remaining in the month in which you retire, a prorated payment will be sent on or before the start of your retirement. For more information, please contact GWL. See page 7 for contact information. 12. How much will my last LTD payment be? This will depend on the remaining benefit due, based on your retirement date. You will either receive your full benefit amount or a prorated amount. For any days remaining in the month in which you retire, a prorated payment will be sent on or before the start of your retirement. For more information, please contact GWL. See page 7 for contact information. HEALTHCARE BENEFIT TRUST 6

8 Early Retirement Incentive Benefit Your Offer and Next Steps December 2013 Contact List and Resources HEALTHCARE BENEFIT TRUST (HBT) Website: Vancouver: Toll-free: CANADA PENSION PLAN (CPP) To receive your CPP retirement pension, you must apply directly to Human Resources Development Canada. Website: Toll-free: BC PENSION CORPORATION MUNICIPAL PENSION PLAN (MPP) Website: Victoria: Toll-free: PUBLIC SERVICE PENSION PLAN (PSPP) Website: Victoria: Toll-free: MEDICAL SERVICES PLAN (MSP) OF BC Website: ICBC BC Lower Mainland: Elsewhere in BC, Canada and the U.S WORKSAFEBC UNIONS Claims Call Centre Phone: Toll-free: Fax (Toll-free): GREAT-WEST LIFE Vancouver: Toll-free: Langley: Toll-free: BCGEU Phone: TF: BCNU Phone: TF: (# 2313) HEU Phone: TF: HSA Phone: TF: IUOE Phone: TF: UFCW Phone: TF: UPN Phone: TF: HEALTHCARE BENEFIT TRUST 7

9 December 2013

10 Factors to Consider About ERIB December 2013 Table of Contents Factors to Consider... 2 Checklist: Consulting with a Financial Advisor... 5 Contact List and Resources... 6 HEALTHCARE BENEFIT TRUST 1

11 Factors to Consider About ERIB December 2013 Factors to Consider If you accept the Early Retirement Incentive Benefit (ERIB) offer, you will retire from your current employment. You will no longer receive any benefits from, nor have any obligations under, the LTD Plan. You will collect your pension income and receive your ERIB lump sum payment. Your Questions Whether ERIB is the right choice for you depends on your own personal circumstances. It is advisable that you speak with a financial advisor and your pension plan before you decide. You may also want to speak with your union representative, employer contact or HBT if you have questions or concerns about the process. See page 6 for contact information. Consulting with a Financial Advisor Your choice to accept the ERIB plan should reflect your personal goals. We also recommend reviewing your overall financial position before making a decision. You will benefit from meeting with a financial advisor by having the opportunity to discuss your financial options and goals. This will allow you to make an informed decision with ease and confidence. To get the most out of your consultation, we suggest collecting proper financial information and documents ahead of time. You should also review your personal goals which will be discussed with your financial advisor. Your Income After Electing ERIB 1. Lump Sum ERIB Payment You will receive a lump sum payment to make up for expected pension income lost as a result of retiring prior to age 65. Tax Considerations: Your lump sum payment is taxable income, it is only payable to you, and it cannot be transferred into an RRSP account. You will receive a T4A for the applicable tax year(s) of your payment(s). Deferred payments will accrue interest at the Bank of Canada T-bill rate. You will receive a T5 for the interest earned. It is advisable that you speak with a financial advisor about your options and the tax implications. 2. Pension Income Assuming your forms are submitted in accordance with your pension plan s requirements, your pension income will begin the first month after you retire. An estimate of your pension income is outlined in the offer letter, and is based on a Single Life Pension, No Guarantee form of pension. Other pension options are available to you and will be presented in your Pension Application package from your pension plan (Municipal Pension Plan or Public Service Pension Plan), which you should receive within two weeks of this offer date. It is advisable that you contact BC Pension Corporation for questions about your pension options, health benefit HEALTHCARE BENEFIT TRUST 2

12 Factors to Consider About ERIB December 2013 provisions, buying back pensionable service, your monthly pension payment dates, etc. See page 6 for contact information. 3. LTD Income If you accept the ERIB offer and retire early, you will no longer receive your LTD benefit income. Your LTD income will continue through to the end of month that you retire on a prorated basis. You will not receive LTD income in subsequent months. If you have questions about your LTD income, contact Great-West Life (GWL). See page 6 for contact information. 4. Canada Pension Plan (CPP) Income If you are already in receipt of CPP disability benefit and choose to accept the ERIB offer you will continue to be entitled to your CPP disability benefit provided that you continue to meet the CPP eligibility requirements. Your CPP disability benefit should automatically convert to a CPP retirement pension at age 65. If you are not in receipt of a CPP disability benefit, you can elect to commence your CPP retirement pension starting at age 60. Contact CPP directly if you have questions. See page 6 for contact information. 5. Other Income Sources If you receive other income or disability payments, such as a WorkSafeBC permanent disability pension for loss of function or an ICBC settlement, you must contact these organizations directly to determine if that income will be affected by retirement. See page 6 for contact information. 6. Any other Family Related Financial Obligations All individuals considering ERIB are strongly encouraged to consult with the appropriate advisors. If you have family or marital related financial obligations, such as separation or divorce settlements with income provisions you are required to meet, it is advisable that you seek legal counsel and also speak with a financial advisor before making any decisions. Your Health Benefits 1. Health Benefits Through Your Employer (if applicable) Should you choose to retire early through the ERIB program, you may be entitled to continue to receive extended health benefits through your employer on a 50/50 cost share basis until age 65. To determine if you are eligible for this benefit or for more information, contact your employer or union representative. See page 6 for contact information. If at any time prior to age 65 you choose to discontinue health benefit coverage provided through your employer, please notify your employer. If you waive coverage through your employer, you will not be eligible to obtain coverage through BC Pension Corporation unless you can provide proof of comparable continuous coverage under another plan. If you do not want to receive health benefits through your employer you can contact your pension plan regarding health benefits available to you (see below). See page 6 for contact information. HEALTHCARE BENEFIT TRUST 3

13 Factors to Consider About ERIB December Health Benefits Through Your Pension Plan Extended health and dental benefits are available to you through your pension plan. Contact your pension plan and the Medical Services Plan of BC directly, for more information about benefits available to you. See page 6 for contact information. Your Group Life Coverage While you have been receiving LTD benefits, your life insurance may have been provided by your employer through a Group Life policy administered by Great-West Life. The benefit amount is $50,000 which is payable to your named beneficiary(ies). If you take early retirement, you will continue to be covered by your employer s Group Life insurance until you turn 65 years of age. Ensure your employer has an Appointment of Beneficiary card on file that reflects your current wishes. This insurance will automatically terminate at age 65 whether you retire early or not. You are entitled to apply to purchase a conversion life insurance policy from Great-West Life, without providing medical evidence of insurability. You may also apply for an individual policy that provides personalized coverage, however you may be required to provide medical evidence of insurability to satisfy the insurer. Keep the Group Life Conversion Form in a safe place: It is your responsibility to submit an application to convert your Group Life policy to a private policy within the timeline specified. You have 31 days after your Group Life coverage terminates in which to apply. The maximum amount that can be converted is $50,000. A form for you to use to convert your Group Life coverage will be provided by your employer. HEALTHCARE BENEFIT TRUST 4

14 Factors to Consider About ERIB December 2013 Checklist: Consulting with a Financial Advisor The following is a checklist of information and documents you should bring to your financial meeting. Please note this is not a complete list. Please feel free to bring other documents that you think would be helpful. ERIB CHECKLIST ERIB Offer ERIB Lump Sum Detailed Calculation Guide Personal Goals/Objectives (Financial or Lifestyle) N/A COMMENTS ASSET INFORMATION Pension (Most recent pension statement or pension estimate at specific date) House Other Retirement Funds (RRSP) Cash and Major Assets DEBT INFORMATION Mortgage Lines of Credit Credit Cards Other Loans/Debts FAMILY INFORMATION Marital Status Dependents Financial Obligations for Spouse/Dependents (duration and amounts) SPENDING INFORMATION Regular Monthly Spending Planned Monthly Spending RISK INFORMATION Life Insurance (other than group plan) HEALTHCARE BENEFIT TRUST 5

15 Factors to Consider About ERIB December 2013 Contact List and Resources HEALTHCARE BENEFIT TRUST (HBT) Website: Vancouver: Toll-free: CANADA PENSION PLAN (CPP) To receive your CPP retirement pension, you must apply directly to Human Resources Development Canada. Website: Toll-free: BC PENSION CORPORATION MUNICIPAL PENSION PLAN (MPP) Website: Victoria: Toll-free: PUBLIC SERVICE PENSION PLAN (PSPP) Website: Victoria: Toll-free: MEDICAL SERVICES PLAN (MSP) OF BC Website: ICBC BC Lower Mainland: Elsewhere in BC, Canada and the U.S WORKSAFEBC UNIONS Claims Call Centre Phone: Toll-free: Fax (Toll-free): GREAT-WEST LIFE Vancouver: Toll-free: Langley: Toll-free: BCGEU Phone: TF: BCNU Phone: TF: (# 2313) HEU Phone: TF: HSA Phone: TF: IUOE Phone: TF: UFCW Phone: TF: UPN Phone: TF: HEALTHCARE BENEFIT TRUST 6

16 EARLY RETIREMENT INCENTIVE BENEFIT (ERIB) Lump Sum Detailed Calculation Guide METHOD, ASSUMPTIONS AND DATA METHOD HBT s actuarial services complete a calculation to determine whether you are eligible for an Early Retirement Incentive Benefit (ERIB) lump sum. This same calculation is used to determine the amount of the lump sum. There are six steps used to determine your eligibility and amount of your ERIB lump sum: 1. Determine what your income would be if you do not retire early: a. Up to age 65 b. After age Determine what your income would be if you retire early: a. Up to age 65 b. After age Determine the difference in income, if any, from retiring early: a. Up to age 65 b. After age Determine the present value of your difference in income, if any, from retiring early 5. Compare the value of your loss of income to the value of future long-term disability payments 6. Establish eligibility and amount of early retirement incentive benefit lump sum 1. Determine what your income would be if you do not retire early If you do not retire early, you are assumed to satisfy the definition of claim and remain on LTD claim to age 65. You are then assumed to retire onto the BC Pension Corporation Pension Plan; Municipal Pension Plan (MPP) or Public Service Pension Plan (PSPP) at age 65. You could be entitled to receive: Up to age 65: Your current monthly benefits from the long-term disability plan with periodic indexing, where applicable After age 65: A monthly pension calculated by BC Pension Corporation, in the normal form and with periodic indexing (if provided), based on earnings and service at retirement (both growing while you are on disability) In this step, we determine the amount of monthly LTD benefit that you would receive until reaching age 65 and we calculate the amount of pension income stream that you can expect to receive from age 65 based on assumed earnings, service to age 65 and assumed indexing after age 65. December 2013 HEALTHCARE BENEFIT TRUST 1

17 ERIB Lump Sum Detailed Calculation Guide Method, Assumptions and Data Example: Sally may be eligible for an ERIB lump sum. She is 60 years old. Her current Net LTD benefit is $1,000 per month (the Net LTD benefit is net of offsets, like Canada Pension Plan (CPP) disability, but before tax). This amount is expected to increase to $1,100 per month, when she reaches age 62. Her projected pension amount, if she stays on LTD claim until age 65, is $1,500 per month, increasing with indexing as provided by the MPP. Sally s expected income if she doesn t retire early would be: o Up to age 65: $1,000 per month until age 62 and $1,100 per month until age 65. o After age 65: $1,500 per month (plus indexing as it occurs) 2. Determine what your income would be if you retire early If you retire early, you would no longer receive your LTD benefit. Instead, you would start your pension from BC Pension Corporation. Depending on your age and service, your pension may be subject to an early retirement reduction. In addition, your pension prior to age 65 will include an additional amount of pension payable to age 65, called a bridge. If you retire early you would be entitled to receive: Up to age 65: Your monthly pension plus bridge as determined by BC Pension Corporation, adjusted for periodic indexing (if provided) After age 65: Your monthly pension (excluding your bridge) determined by BC Pension Corporation including assumed indexing from your date of early retirement to age 65, and increasing with periodic indexing (if provided) thereafter In this step, we rely on the figures provided by BC Pension Corporation for your pension (and bridge) on early retirement. We calculate the income stream over time based on assumptions for future indexing from the pension plan. Example: MPP informs HBT that Sally is eligible to receive a pension on her early retirement of: o Up to age 65: $1,600 (including a $400 bridge) o After age 65: $1,200 (no bridge) Until reaching age 65, Sally s pension is assumed to increase with indexing. HBT determines that when Sally reaches age 65, her pension will increase from $1,200 per month to $1,300 per month. HBT uses the following as Sally s expected income assuming that she retires early: o Up to age 65: $1,600 per month (plus MPP indexing as it occurs) o After age 65: $1,300 per month (includes indexing to age 65 and then future indexing as it occurs) December 2013 HEALTHCARE BENEFIT TRUST 2

18 ERIB Lump Sum Detailed Calculation Guide Method, Assumptions and Data 3. Determine the difference in income, if any, from retiring early By retiring early, you will change your expected income stream from the amounts determined in step 1 above to the amounts determined in step 2 above. In this step, we determine the difference as follows: Up to age 65: The income that you would have received from the LTD plan (determined in step 1) less the income that you would receive from the pension plan on early retirement (determined in step 2) After age 65: Your monthly pension you would receive after age 65 assuming retirement at age 65 (determined in step 1) less the income that you would receive from the pension plan after age 65 following early retirement (determined in step 2) This difference may, and often does, result in an income gain in the period up to age 65 and an income loss in the period after age 65. Example: In Sally s case, her income difference prior to age 65 (including bridge) is (adjusted slightly for assumed pension indexing): o Until age 62: $600 gain ($1,600 monthly pension versus $1,000 net LTD payment) o Between age 62 and age 65: $500 gain ($1,600 monthly pension versus $1,100 net LTD payment) Her income difference after age 65 would be (adjusted for future assumed pension indexing): o $200 loss ($1,500 pension if she retired at age 65 versus expected $1,300 pension from age 65 if she retires today) 4. Determine the present value of your loss of income, if any, from retiring early The amounts in step 3 above are incomes in the future. In this step, we express the income stream (losses and gains from retiring early) as a single lump value, called the present value of your loss of income. Based on the assumptions below, we calculate the present value of your loss of income as follows: We start with the income differences determined in step 3. We multiply each payment by the likelihood of your receiving the future benefit (you are extremely likely to receive your LTD payment next month and less likely to receive your pension payment in the month following reaching age 90), and We apply a discount factor to future payments to determine today s value of each future payment ($1 today is worth more than $1 in the future. Payments in the future need to be discounted). The resulting value is the loss of income from retiring early. If the figure produced from the calculation is negative, there is no expected income loss. In fact, there is a gain in your total income (in long-term disability and pension when taken together) by retiring early. December 2013 HEALTHCARE BENEFIT TRUST 3

19 ERIB Lump Sum Detailed Calculation Guide Method, Assumptions and Data Example: In Sally s case, the present value of her loss would be approximately: o Income difference prior to age 65: $30,000 gain o Income difference after age 65: $40,000 loss o Total present value: $10,000 loss 5. Compare the value of your loss of income to the value of future long-term disability payments In its normal course of operation, HBT determines a value of your future long-term disability income payments. HBT holds this amount as a reserve. This reserve is determined using similar principles as what is used to determine the present value in step 4 above. The present value determined in step 4 above is compared to the reserve held for your long-term disability income payments. Example: Suppose that Sally s reserve for future LTD payments (assuming Sally doesn t retire) were $20,000. In this step, we compare: o Reserve of $20,000 o Present value of loss of income of $10, Establish eligibility and amount of early retirement incentive benefit lump sum You are eligible for an ERIB lump sum if HBT s reserve held on your behalf is greater than $1,500 and: We determined that you had a gain in step 4, or We determined that you had a loss in step 4 and it is less than the reserve held by HBT on your behalf. If eligible, the amount of your ERIB lump sum offer will be the maximum of: The loss determined in step 4, and $1,500. Example: Sally s present value of loss is less than her reserve, so Sally would be eligible for an ERIB lump sum. Sally would be entitled to the greater of $10,000 and $1,500, so she would receive an ERIB lump sum offer of $10,000. December 2013 HEALTHCARE BENEFIT TRUST 4

20 ERIB Lump Sum Detailed Calculation Guide Method, Assumptions and Data ASSUMPTIONS To calculate present values, we assume that you retire at age 65 or earlier. Key assumptions are: No changes in LTD offsets prior to age 65: existing offsets remain and no new offsets Likelihood of satisfying LTD definition of disability until age 65: 100% Likelihood of dying prior to age 65: none Likelihood of dying after age 65: in accordance with UP94 Generational Mortality table (90% female) Interest rate: first 10 years thereafter Price inflation: first 10 years thereafter Highest Average Salary Increase MPP Pension Increase (pension-in-pay) Yearly Maximum Pensionable Earnings (YMPE) Increase Long-term disability increases (if applicable) In addition, we also assume that there are no changes in long-term disability and pension plan provisions. DATA Our calculations are based on the following data: Date of Birth Date of Early Retirement Pensionable Service at date of Early Retirement Contributory Service at date of Early Retirement Highest Average Salary at date of Early Retirement Pensionable Service Accrual Rate at date of Early Retirement Net long-term disability income at date of Early Retirement Next long-term disability increase date December 2013 HEALTHCARE BENEFIT TRUST 5