August 13, 2007: The assets of the Central States Pension Fund have jumped $700 million in the first six months of this year, reaching $21.4 billion, and could reach $22 billion by the end of 2007. This is according to the fund’s latest Financial and Analytical Report, obtained by Teamsters for a Democratic Union.
Now is the time to restore affordable retiree health and welfare and get a timetable for improved pension benefits, in the current round of national negotiations. The facts back this up.
At the end of 2003 the Central States Fund was down to $15.3 billion in assets. Fund assets have grown by 40 percent in 3 and a half years.
As of Aug. 1, the Fund is now taking in even more money, because the 70¢ per hour benefit increase in the national contracts was split 40¢ to pension and 30¢ to health and welfare. This new pension money means that a Teamster who works all year under the freight, UPS, carhaul or pattern contracts now accrues $132 per year in retirement benefits. For the first time in four years, some of the benefit money is going to into the health and welfare fund.
The report also reveals that the ratio of active Teamsters to retirees has almost stabilized. There are 212,000 retirees and 146,000 active (full-time) Teamsters, numbers very similar to last year.
The Fund is taking in more money in employer contributions than last year, while paying only slightly more in benefits. Employer contributions are up at an annual rate of about $172 million per year over last year. That explains some of the growth in assets; another big factor is the fund’s healthy return on investments.
While the pension fund is still seriously underfunded, the situation is on the upswing. This is the time to start to expect improvements: first in retiree health coverage (which is provided by the health and welfare fund), and later in pension benefits.
Teamsters can demand full restoration of affordable retiree healthcare in the current contract round. We demand guaranteed increases into the health and welfare fund to support this. No excuses.
Teamsters can demand a timetable for restoring and improving pension benefits.
Teamsters can unite to protect the Central States Fund from UPS management’s plan to split it. The loss of 43,000 active UPS Teamsters would badly hurt the fund’s ratio, and would not benefit UPS Teamsters a bit.
Note that this report is only available because TDU members went to court and forced the fund to reveal this information, which TDU makes available to participants.