Posted on Mar 13, 2008
John M Grau
Larry Bradley’s response that I posted in my last entry raised a couple more questions, so I went back to the source for a little more information.
JG: Larry, you said that NEBF is in great shape now, what’s to prevent it from entering the “red zone” sometime in the future? Are the Trustees making any plans to prevent this from happening?
LB: The Trustees are well-aware of the current status of the securities markets as well as the current demographic trend of the Baby Boomers entering retirement age. They are constantly monitoring demographic trends to insure that NEBF pension benefits are available not just for the Baby Boomers but for the generations after them.
Steps have already been taken to ensure the soundness of the Fund. One of the most important of these steps is that NEBF contains a plan provision prohibiting the Trustees from increasing benefits if doing so creates a withdrawal liability.
Additionally, there are numerous checks and balances protecting NEBF. Investment advisors provide feedback on investment performance to the Trustees. These same advisors are overseen by a separate investment expert, furthering security. And NEBF is valued annually by independent actuaries based on conservative actuarial assumptions agreed to by the Trustees. This means the actuaries can inform the Trustees of any potential impending problems.
JG: So, in the end, should the employers contributing to NEBF be worried about unforeseen liabilities that they may have to pay for down the road?
LB: While all pension plans carry inherent risks, our contributing employers can take comfort in the fact that the Trustees are taking proactive steps to ensure NEBF’s security which is reflected in the fact that the plan is fully funded for vested liabilities. As stated previously, the Trustees goal is to keep NEBF secure not just for the Baby Boomers in our industry but for future generations of electrical workers and their employers.
If you have a question about NEBF feel free to respond to this blog. I’ll pass your questions or comments on to Larry, and we’ll include more NEBF information in future postings.