Geneva – February 2015 Overview Understand what the Fund is. Know what to expect from the Fund. Overview of pension benefits. Get practical information related to your participation. Pension Fund Goal To provide participants with an “income replacement” at age of retirement To provide coverage in case of a participant’s/retiree’s death or disability 4 What’s the UNJSPF ???? ICSPRPP UN WHO ICGEB A JOINT Fund ILO WTO (Madrid) WIPO ISA WMO ITLS FAO 23 Member Organizations EPPO UNESCO STL IAEA IMO UNIDO WMO ITU IFAD ICAO IPU ICC A “DEFINED BENEFIT” Pension Scheme “US$ based” Pension Scheme => All Benefits initially calculated in US$ 8 Is the UNJSPF Solid ???? UNJSPF: Active Participants total growth (2003-2013) A decrease of 0.7% from 2012 11 UNJSPF: Beneficiaries Total Growth (2003-2013) A 3.4% increase from 2012. 12 UNJSPF: Short-term Funding Status $2.169 Billion Contributions and $2.3 Billion Benefit Payments in 2013 During the year 2013, benefits were paid in 15 different currencies. The net assets available for benefits increased by $6.7 Billion. The difference between Contributions and Benefit Payments for 2013 is $131 Million (Source: PF Annual Report)13 UNJSPF: Market value of assets The value of the Fund’s assets increased from $45 billion on 1 January 2013 to an all time high $51.6 billion on 31 December 2013, an increase of about 14.9% (Source: PF Annual Report) 14 UNJSPF: Long Term Funding Status The 2013 valuation revealed a deficit, amounting to -0.72 per cent of pensionable remuneration. The -0.72 per cent, expressed another way, means that the theoretical contribution rate required to achieve balance as of 31 December 2013 was 24.42 per cent of pensionable remuneration, compared to the actual contribution rate of 23.70 per cent. These results show a reverse of the downward trend experienced by the Fund since 2001 which is a significant positive long-term development considering the 15 size and maturity of the Fund. (Source: PF Annual Report) UNJSPF: Long Term Funding Status The funding ratios are comparisons of the current assets of the Fund with the value of the accrued benefits (liabilities) on the given valuation date and are calculated on a “plan termination basis.” With respect to its liabilities on 31 December 2013, the Fund was found to be in a strongly funded position, as it had been for the past ten valuations. The current funded ratio is 128 per cent, which was obtained by dividing the actuarial value of assets (i.e. $46,205 million) by the actuarial value of the accrued benefits (i.e. $36,244 million). The ratio therefore indicates that there is a 28 per cent margin of assets over accrued liabilities. The funded ratio is lower when the current system of pension adjustments is taken into account, whereby benefits are adjusted for inflation. (Source: PF Annual Report) 16 Participation into the Fund Article 21 sets the conditions for mandatory participation into the Fund when a full-time member of the staff of a member organization of the Fund: Commences employment under an appointment for 6 months or longer or accepts such an appointment while in employment or Completes, in the same or more than one member organization, 6 months of service without an interruption of more than 30 days whichever is earlier, provided that participation is not expressly excluded by the terms of staff member’s appointment. Age (NRA vs MAS) Normal Retirement Age (NRA): Age when a SM can draw a pension without reduction factors (penalties). Age when a staff member is entitled to a Normal Retirement Benefit. This age is based on the Regulations and Rules of the Pension Fund Normal Retirement Age for participants entering the Fund before 01 January 1990 is Age 60, between 01/01/1990 to 31/12/2013, it is Age 62 Early retirement age for these participant starts at age 55 Normal Retirement Age for participants entering the Fund on or after 01 January 2014 is Age 65 Early retirement age for these participant starts at age 58 Normal Retirement Age for participants entering the Fund on or after 01 January 2014 is Age 65 Early retirement age for these participants starts at age 58 Early Reduction factors are: 6% per year for CS less than 25 years 4% per year for CS of 25 years or more (applicable for max 5 years) Deferred Retirement benefits start to be adjusted from age 55 Mandatory Age of Separation (MAS): Age until when a staff member is allowed to work by his/her Employing Organization. This age is based on the Regulations and Rules of the UN Common System, but cannot be before NRA. If you started working for a Member Organization before 01 January 2014, but started participating in the Fund on or after 01 January 2014, make sure your HR Office sets your Mandatory Age of Separation at 65 to align it with your Normal Retirement Age. If you enter the Fund on or after 01 January 2014, and are separated at any age between 58 and 65, it will be an Early Retirement benefit for the Fund with a reduction of 4% per year (max 5 years) for those with 25 years CS or more and 6% per year for those with less than 25 years of CS. Staff Members who entered the Fund prior to 01 January 2014, and who re-enter the Fund on or after 01 January 2014 within 36 months with no benefits paid will retain their Normal Retirement Age at 60 or 62. Staff Members who entered the Fund prior to 01 January 2014, and who re-enter the Fund on or after 01 January 2014 beyond 36 months or after being paid a benefit will have a new pension number with Normal Retirement Age at 65, even if they restore the prior service Options to Increase your Contributory Service – Know your rights and be pro-active! Validation Restoration Transfer Agreements SLWOP Validation • Option to make prior-period of employment “pensionable” • 1-year deadline to exercise it (Form B/1) Restoration • Option to “merge” a prior period of contributory service into another one • 1-year deadline to exercise it (Form C/1) Transfer Agreements • Option to “carry-in/out” accrued pension rights • Different deadlines in Agreements Article 23 sets the conditions for validating prior noncontributory service: Period(s) of employment with a member Organization without participation due to length of contract. All periods open for validation must be validated Request must be submitted by the participant within 1-year of entry/re-entry into the Fund by completing the B/1 form (available on the website) and sending it directly to the Pension Fund. The Fund will determine Eligibility to Validate upon receipt of the Form. Article 24 sets the conditions for restoring prior contributory service: Period of Participation with Fund where either a Withdrawal benefit was paid or a Deferred Retirement benefit elected before April 2007 is not in payment. Only the most recent period of contributory service is open for restoration Request must be submitted within 1-year of reentry into the Fund by completing the C/1 form (available on the website) The Fund will determine Eligibility to Restore upon receipt of the Form. SLWOP • Possible to keep contributing to the Fund during this period. • Decision to do so must be taken before SLWOP. SM must inform their payroll of the decision • Participant pays his/her share of contributions and that of his/her employing organization (i.e. his/her monthly pension contributions x 3) • In case of withdrawal settlement only participant’s share will be paid back. A Pension Fund ? What for ???? To provide participants with an “income replacement” at age of retirement To provide coverage in case of a participant’s/retiree’s death or disability What will YOU get from your 7.9% contributions ? Benefits to Participants Normal Retirement Benefit (age 62/65) Early Retirement Benefit (from age 55 to less than 62 or from age 58 to less than 65) Deferred Retirement Benefit (under age 55 for 62, and under 58 for 65) Disability benefit Withdrawal Settlement UNJSPF: Other Benefits Widow’s/Widower’s Benefit (arts. 34 & 35) Divorced Surviving Spouse’s Benefit (art. 35 bis) Spouse Married after Separation from service (art. 35 ter) Child’s Benefit (art. 36) Secondary Dependant’s Benefit (art. 37) Residual Settlement (one-time payment – art. 38) Let’s CALCULATE ! Pension Elements The type and level of the benefit from the Fund depends on your: i. Length of contributory service (CS) ii. Age at time of separation iii. Rate of Accumulation for each year of CS (ROA) iv. Final Average Remuneration (FAR) – Revenue Component Normal Retirement Pension Calculation (Age 62): Full pension Years of Contributory Service (CS): 25 yrs Rate of Accumulations (ROA): 1.50% for first 5 years = 7.50% 1.75% for next 5 years = 8.75% 2.00% for next 15 years = 30% Final Average Remuneration (FAR) : $188,888 Full Annual Pension ($188,888 x 46.25%) = $87,360 46.25% Reduced Annual Pension (i.e. with a lump sum) (1/3 of $87,360) x 11.697 (estimated actuarial factor) = $340,585 Reduced Pension (2/3 of full annual pension) = $58,240 42 YOUR 7.9% contributions will ALWAYS be paid out The Withdrawal Settlement . . . Withdrawal Settlement One-time payment extinguishing all other rights. Represents a participant’s contributions plus interest. The Organization’s contributions are NOT reimbursed to participants. If CS is more than 5 years, amount is increased by 10% for each year over 5 up to a maximum of 100% (=> max. = 15 years CS). 15 CS years => 10 CS years over 5 10 CS years x 10% => 100% increase Contr. + Interest: $100,000 100% increase Withdrawal Settlement: $200,000 The Residual Settlement . . . The Residual Settlement The Residual Settlement is a one-time payment made by the Fund and only if no other monthly benefit is payable. Payment is made to the person(s) designated by the participant (in form Pens.A/2) in accordance with percentages (if any) set by him/her. Contributions plus Interest Total Benefits Paid Residual Settlement In need of help ? UNJSPF P.O. Box 5036 New York, NY 10017 Tel: +1-212-9636931 Fax: +1-212-9633146 E-mail: [email protected] UNJSPF GVA UNJSPF NY If you need further assistance . . . UNJSPF Palais des Nations 1211 Geneva 10 Tel: +41-22-9288800 Fax: +41-22-9289099 E-mail: [email protected] Office Location: DuPont de Nemours Building Ch. du Pavillon 2, 1218 Grand-Saconnex, UNJSPF GVA How to contact us. . . At the “PERMANENCE” Office: PALAIS DES NATIONS Geneva AAFI-AFICS Office, Door 15 Office No: A265 Open Hours: Tuesdays and Fridays 12:00 to 14:30 with or without appt Prospects New Integrated Pension Administration System (IPAS) Access to a Member Self Service (MSS) Current Services will be retained Single access to be used as participant and retiree (Unique Pension Fund ID to be used) View of Demographic information, ability to update personal information and more features A broadcast will be sent out before go-live Please Register now on the current website in order to get automated information from our Webmaster SAMPLE PARTICIPANT ACCOUNT ON MEMBER SELF-SERVICE (MSS) Thank you VERY MUCH for your attention!
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