Follow-up Q&As from 2020 annual general meeting

Review the extra questions and answers from the AGM’s live Q&A session.


The Municipal Pension Board of Trustees (board) has committed to responding to all enquiries it received at the AGM. Following are responses to questions we were not able to address within the allotted time frame.

Plan changes

Will more webinars on plan changes be scheduled?

Webinars on plan changes were held on October 16 and 19. A recording is available to view at mppredesign.ca. Details on the plan redesign proposal, including a calculator for general members, are available on this website.

 

Climate change

BCI has noted its intention to measure the carbon exposure of its assets over time, but it is not clear that there is a plan to get our investments to reduce emissions to a specified target. Does BCI intend to have an overall carbon reduction goal, and on what timeline?

We are not in a position to speak on behalf of our investment management agent, BCI, but we can address plan fund investments. As part of our commitment to climate action, starting with the 2019 Annual Report, we will be disclosing climate-related financial information.

Can the board disclose how much of the fund is invested in oil, gas and coal companies? Are these investments aligned with Canada’s commitment to reduce greenhouse gas emissions (GHG) by 30 per cent below 2005 levels by 2030, and B.C.’s commitment to reduce GHG emissions by 40 per cent below 2007 levels by 2030?

The board has not established targets for reducing GHG emissions or aligning its investments with federal or provincial government commitments. To address this question overall, we must note that the board has a fiduciary duty to govern the plan in the best financial interests of members. This common law duty is reinforced in the plan’s trust agreement and codified in the Pension Benefits Standards Act.

The plan is invested in Canadian, global and emerging markets energy companies. Energy companies include those in clean, renewable energy. Taken together, in the last six-year period, as at the end of the calendar year, these ranged from 3.8 to 7.3 per cent of total plan investments.

In the 2019 Annual Report, we published the plan’s top 25 company holdings. As at December 31, 2019, the top five energy holdings are:

  1. Suncor Energy Inc.
  2. TransCanada Corp.
  3. Enbridge Inc.
  4. Reliance Industries Ltd.
  5. Canadian Natural Resources Ltd.

The board supports BCI’s approach to responsible investment, which has been to pursue a policy and practice of engagement, to encourage companies to adopt high standards of corporate governance, environmental and social responsibility. The board believes that engagement is a more effective strategy than divestment to initiate change. BCI, by using its influence as a large institutional investor, encourages companies to:

  • prepare for a shift to a low-carbon economy,
  • manage climate change risks and opportunities, and
  • disclose on topics such as environmental risk assessments, greenhouse gas emissions and reduction targets.

BCI has been researching and formalizing their approach to climate action in response to the two-degree Celsius limit in the Paris Agreement. BCI’s Climate Action Plan maps out a strategy for identifying opportunities and managing the risks of climate change.

Both the board and BCI are signatories to the United Nations-supported Principles for Responsible Investment (PRI). PRI is an international network of asset owners and investment managers whose goal is to understand the implications of sustainability for investors, so signatories can factor these issues into their decision-making and ownership practices. The board is also a signatory to Climate Action 100+, an investor initiative to ensure the world’s largest corporate greenhouse gas emitters take action on climate change.

 

Investment performance

What is the average annual return of the public equity portfolio?

The 10-year annualized rate of return for the public equity portfolio was 9.9 per cent as at December 31, 2019. This exceeded the benchmark of 9.6 per cent.

 

Buying service

Can I purchase my service from when I was casual for six months?

You may be eligible to buy your non-contributory service if you are an active plan member and have not waived enrolment in the plan. Visit Taking time off work and buying service to learn more about deadlines and the process for buying service. You can also sign in to My Account and use the purchase cost estimator to get an estimate of the cost.

 

Post-retirement group benefits and review

Is it a guarantee that PBC will cover Manulife’s “pre-existing conditions”?

When you retire, your active employee health benefits program ends. You can choose to enrol in the plan’s retirement health benefits program. You must apply to enrol within 60 days of the end date of coverage under another health and dental plan. After this time, you must provide proof of continuous coverage.

Pacific Blue Cross (PBC) will cover any health-related pre-existing conditions and reimburse you for items available under the retirement health benefits program. As all programs have different coverage levels, please familiarize yourself with the retirement health coverage on the plan website and view the retirement health coverage booklet on PBC’s site, or log on to your PBC member profile.

Please note that some products or items covered under your previous program may not be covered under the new program due to different contract terms or drug formulary requirements. Please refer to information on the BlueRx formulary on the PBC website.

How much coverage do we have on our dental for dentures after we have retired and are on the extended health care plan?

Dentures are not covered as an eligible expense under the extended health care plan.

The essential dental plan also does not provide coverage for dentures. If you are enrolled in the enhanced dental plan, however, you do have coverage for complete or partial dentures, up to one upper and one lower denture every five years to the annual maximum of $2,000 per person per calendar year. No benefit is payable for replacing lost, broken or stolen dentures.

For more details on coverage, see the retirement health coverage booklet on PBC’s site, or log on to your PBC member profile.

As only 4,000 members completed the post-retirement group benefits survey out of 210,000 members, would you consider sending out the survey again, given about 450 attendees have participated today and can tell others to become involved?

The survey focused on retired members and active members within five years of retiring, not the total membership. The opportunity to provide feedback in the engagement survey was October to November 2019. Member input was one component of our decision making. We also considered many technical aspects, including analyzing claims data and other plan data, benchmarking against similar plans, studying the group benefits contracts, assessing funding status and projections, reviewing administrative expenses and premiums, and educating ourselves as a board about group benefit issues and trends.

We regularly review the group benefits program and consider comments and feedback from members on an ongoing basis.


External link for 2020 AGM Q&As

MPP resources on Pacific Blue Cross website