Posted: January 25, 2012
Tom's take on the latest AMO Pension Plan review
As you know, the original actuarial projection in 2010 put full funding of the defined benefit AMO Pension Plan in seven years. In the Plan year of October 1, 2009 through September 30, 2010, excellent returns on Plan investments had us on track to this target. But investment returns were flat in the Plan year that ended September 30, 2011. This could result in longer recovery time for the AMO Pension Plan.
The problem here is the erratic performances of all investment markets since 2008 - not even the most educated, most experienced investment advisors and analysts can predict market paths with any certainty under current conditions.
But the Dow Jones Industrial Average is twice what it was four years ago, and other economic indicators suggest that investment markets could stabilize in time to generate several years of positive return, which would bring the AMO Pension Plan closer to its objective - full funding by 2017. This is a time for patience, not panic.
The joint union-employer trustees of the AMO Pension Plan are working closely with a new actuary to develop options to restore the AMO Pension Plan as quickly as possible, and we will keep all AMO members informed along the way.
January 25, 2012