Bulletin 35

Autumn 2007

  1. Editorial
  2. Committee Activities
  3. Permanences
  4. Obituary
  5. The CERN Health Insurance Scheme (CHIS)
  6. The Pension Fund
  7. SCC Working Group on Pension Guarantees

Editorial

(Original French)

Hello! Anyone there?

No response to my previous editorial! No doubt taxation has few secrets for the majority of you: so much the better.

With the cooperation of the Staff Association and the Administration, the conferences on preparation for retirement took place satisfactorily this year, and documents will be available, at least on the internet.

If you know anyone approaching retirement who may be interested in joining our Committee, encourage them to come forward!
Below you will find accounts by our specialists of developments concerning us: despite disappointment at the judgment of the ILO Tribunal, they retain their energy and enthusiasm, and happily there are positive aspects. See inside the Bulletin for the latest news.

Finally, as they share our lot in Pension Fund affairs, the Committee has proposed that ESO retirees join us in our Association; hence your surprise on the change of name of our site!

See you all soon then at the end-of year drink.

And happy Christmas and New Year!

Jean-Marie THOMAS

Committee Activities

(Original French)

March to October 2007

The Committee, made up of 20 members after the Autumn 2006 elections and the co-opting of Manfred Buhler-Broglin and Robert Cailliau met 6 times during this period under the presidency of Philippe Bernard.

The principal matters treated were:

Statutary Activities:

Elections

The statutes oblige us partially to renew the Committee in December 2007 as the mandate of 9 of the 20 members will expire 31 December. Those concerned are:

The Committee thanks all these people for their work during the last two exercises, and certain of them for work during previous exercises.

We must also renew the account auditors, as their mandates also will expire 31 December 2007. Concerned are:

A call for candidates has been circulated.

GAC General Assembly

250 members with 85 further members formally represented attended the General Assembly held 30 March 2007. The minutes of the Assembly have been circulated together with the documents concerning the 2007 elections

Relations with the Staff Association

Most dealings with the Staff Association have concerned Pension Fund problems.

As you know, discussions on the new form of governance of the Fund have ended in a decision by the CERN Council in June 2007, adopting the new governance structure by 1 October 2007.

Significantly, our stance as retirees will be strengthened as our Delegate to the Fund Governing Board will, rather than an observer, be a full member, with voting rights.

Furthermore, these discussions have led to a change in the name of our Association. As our Delegate to the Governing Board will also represent ESO pensioners, we have added to our Committee a place for a member elected by our retired ESO colleagues. Even if our acronym GAC will no doubt still be seen here and there, we must get used to our new identity: GAC-EPA “Groupement des Anciens CERN-ESO Pensioners' Association”

The three-yearly actuarial examination of our Pension Fund is also being studied. Based on this, the Governing Board must formulate recommendations to Council.

F.Wittgenstein's article gives some preliminary information on this subject, which must be of a general nature as Council is not yet informed.

Our appeal to the Administrative Tribunal of the ILO, wherein we insisted that the effort requested of Pensioners to secure the long term stability of the Fund should be reduced in the same proportion as that for the other two concerned parties (active staff and the Organisations), has unhappily been rejected.

Other contributions from our delegates in this edition of the Bulletin bring up to date the matters of the future of our Health Insurance and work on the guarantee of our pensions.

Relation with present and future pensioners

At the five permanences held since the previous Bulletin, 3 GAC members have dealt with general and particular problems arising in retirement. (See the relevant article).

Our website, in the hands of J.Allaby , is in good shape and R.Cailliau has introduced operational improvements facilitating its use.

Given our new acronym (GAC-EPA), our web address will henceforth be: http://www.gac-epa.org/

We shall next see each other at our Christmas drink Wednesday 28 November at 16h30. Note this date!

Jean-Claude GOUACHE

Permanences

(Original français)

February to November 2007

Since our report in Bulletin 34 last March, there have been five permanences, as in July and August the permanences are suspended. In the five sessions we welcomed 25 colleagues.

Questions largely concern familiar topics: financial conditions in different countries, reimbursement of medical expenses by UNIQA or the French Social Security. Nonetheless certain matters may be mentioned:

GAC permanences are held in the large Staff Association conference room opposite the cafeteria, R-006, Building 61. All present and future beneficiaries of the pension fund are welcome to attend between 14h and 17h on the first Tuesday of each month except when the permanences are suspended in January, July and August. There is also a reminder of the next permanence in 'Echo', the bulletin of the Staff Association.

We wish to all our colleagues and their families a good year; we hope you keep well despite the years flying by.

René BARTHELEMY, Françoise BEETSCHEN-BUTTAY, Mario CESELLI

Obituary

We have learned with regret of the deaths of our former colleagues named below:

Jean-Pierre A MARCA ex-MT 19 February 2007
Patrick MOLLET ex-DG 21 February 2007
Ian BARNETT ex-SL 22 February 2007
Georges ERSKINE ex-DD-DI 13 March 2007
Louis BLANC ex-PS 17 March 2007
Zbigniew JENDRYSIAK ex-ST-CE 20 March 2007
Michel LETTRY ex-PPE 24 March 2007
Gabrielle LOUVRIER ex-ADM 30 March 2007
Jean DUTRANNOIS ex-TIS 9 April 2007
Jean GERVAISE ex-LEP 10 April 2007
Charles MUTSCHLER ex-ST-TIS 15 April 2007
Carmelo ZINZERI ex-PS-PO 16 April 2007
Romualdo ROTELLI ex-FI 20 April 2007
René PERRIN ex-ST 27 April 2007
Maurice JACOB ex-DSU 2 May 2007
Frans VAN HOLTEN ex-DG 7 May 2007
Andrée DARX-DUBOIS ex-EF 10 May 2007
Roger GIROD ex-PS 9 June 2007
Jean CHARLOTTON ex-SB 14 June 2007
Shaun MINOR ex-TIS 23 June 2007
Noël RINALDI ex-ST 24 June 2007
Charles FAVRE ex-TIS 28 June 2007
Angelo MENONI ex-ST 6 July 2007
Jean-Marie DUFOUR ex-DSU 8 July 2007
Kjell JOHNSEN ex-LEP 18 July 2007
Rémy BOUVRY ex-IT 5 August 2007
Fernand MEMBRARD ex-ST 15 August 2007
Elie MENANT ex-AT-SU 18 August 2007
Gilbert MOURON ex-AT 27 August 2007
Gabriel MICHEL-NOEL ex-TIS 1 September 2007
André GRESSOL ex- 9 September 2007
Leone PETRONIO ex-SB 20 September 2007
Georges NASSIBIAN ex-PS 22 September 2007
Paul DECHELETTE ex-PPE 9 October 2007

and of the death of other beneficiaries of the Pension Fund:

Marie-Louise LAMARD (veuve de Roger, ex-SB) 25 February 2007
Carmen ERSKINE (veuve de Georges, ex-DD) 26 March 2007
Madeleine BOTTOLI (veuve d’Aldo, ex-SB) 29 August 2007
Thérèse HIRSCHI (veuve de Paul, ex-PS) 1 September 2007
Lucette BERGER (veuve d’Edmond, ex-EF) 29 September 2007

On behalf of all members of GAC, the Committee sends its sincerest sympathy to the bereaved families.

If you wish to write a word of sympathy to the bereaved family you can send it via the CERN Pension Fund, which has the address but is not authorised to give it to third parties.

The CERN Health Insurance Scheme (CHIS)

(Original French)

There follows new information concerning our Health Insurance Scheme

Investment of the CHIS funds: The investment of CHIS assets remains a problem. CERN is obliged to respect international accountancy regulations which do not permit borrowing by funds which possess a reserve. As CHIS has no separate identity in law its assets appear in the general Organization accounts. We await legal advice as to who in reality owns these funds, and how rights and responsibilities are apportioned. CHIS assets at the end of 2006 amounted to around 80 MCHF, of which some 36 MCHF are for long-term care insurance.

However, recent news is that the CERN Directorate, having noted the problem, has decided to create, as from 2008, a capitalised Fund from the assets at 31 December 2007, of around 93 MCHF.

Study Group on the future of Health Insurance (CHIS): The study group directed by Vincent Vuillemin is mandated to examine the future of CHIS. A preliminary report has been submitted to TREF (the tripartite Forum). Recently we received a copy of the report of the actuary examining this question, including the future of long-term care insurance.

For this latter we we may report that the figures currently available are less pessimistic than the estimates of 5 years ago (9 new cases per year rather than the original estimate of 22).

This situation appears optimistic for future costs and the group is considering the question of a readjustment of the daily indemnity.

For CHIS as a whole, studies continue and conclusions are not yet finalized.

EHPAD Ornex: Building work has commenced and completion is foreseen for the second half of 2008. A further meeting with ORSAC, the future managers, was held 11 July. A new proposal submitted to us would allow us to reserve 5 beds for a period of 15 years.

HUG: The Cantonal Hospital (les Hôpitaux Universitaires de Genève) has adopted a new tariff structure by pathology which is now in operation. It will no doubt result in a significant increase in hospitalization costs. This matter causes some concern. Discussions continue on the hospitalization tariffs applicable to CHIS members. We may point out that Geneva contributors benefit from a much more favourable rate than internationals, who will be charged three times as much; whence our concern.

Conventions with other establishments are also either under revision or have been brought up to date.

We shall keep you regularly informed of the latest developments either via the CHIS Bulletin or by other channels if necessary. This is particularly important for any evolution of contributions and reimbursements and also for the matter of the real costs of our Health Insurance.

Jean-Paul Diss, Pierre Lazeyras, Robert Muzelier

Decision of the BIT Administrative Tribunal

Concerning our appeal in the matter of pension indexation in 2006

You will remember that in Spring 2006, GAC, represented by two of our colleagues introduced before TAOIT an appeal on the grounds of equity against the indexation of our pensions 1 January 2006. Here we recall the situation.

In July 2005 the Governing Board proposed a series of measures aimed at re-establishing the financial equilibrium of the Fund. A pensions indexation below the cost of living index, and also an increase in the contributions of active staff were proposed, and accepted by all parties, including the Director General, who however stated that he was unable for the moment for financial reasons to accommodate in its entirety the extra cost to CERN. He proposed that this cost be reduced by 79%, implying a corresponding reduction in the extra contribution of active staff. This proposal was accepted by Council.

GAC protested that in the name of fairness, the burden of the extra cost should be borne equally by all three parties and not disproportionately by the pensioners, and that in consequence the indexation of pensions should be revised to a higher value. This was refused and GAC placed the matter before TAOIT, the Tribunal Administratif de l'Organisation du Travail.

In its ruling No. 2655 dated 11 July 2007, the Tribunal rejected our appeal. This was for us an incomprehensible disappointment.

Essentially the reason given for the ruling stated that our request for an increase in indexation had no basis because it fell at a moment when the resources of the Fund were being depleted by the proposed reduction in the increase of contributions! Of course, and here we quote the ruling, "the pensioners might on the other hand have feared that the impossibility of increasing the assets of the Fund as initially foreseen would bring about a reduction in pensions indexation, fixed at 82.5% of the observed inflation rate in Geneva." Note furthermore that the word 'equity' does not appear in the ruling!

This ruling is final and is not subject to appeal. But we shall not give up, as we cannot accept that measures aimed at restoring the equilibrium of the Fund continue to fall inequitably on pensioners, as has been the case for years. We shall keep you informed of our next moves. An individual appeal on the same matter is about to be placed before the same tribunal and we hope to see a ruling next year.

Jean-François Barthélemy

The Pension Fund

WHAT IS HAPPENING?

 State as at 27 September 2007

New Governance

During the meeting of 21 June 2007, Councui approved the conclusions of the study group mentioned in our previous Bulletin regarding the introduction of a new governance structure of the Pension Fund. In particular the following principles were confirmed :

To this end, the previous Governing Board was replaced 30 September 2007 by a new Board consisting of 10 members including 2 outside experts. CERN and ESO, the beneficiaries, are represented by one delegate with voting rights, chosen by the GAC-EPA Committee. The President is selected from the 2 CERN Council representatives. Board members are elected for a 3 year term, renewable once.

The new Governing Board reports to the CERN Council, who take the advice of the Director General on the proposals of the Board, which may have repercussions on the financing of the Organisation.

The new Board must now :

Current business

The CERN bulletins of 24.09.07 and 01.10.07 remind us of the main concerns of the Governing Board :

The ongoing actuarial three-yearly examination

Current stock market turbulence

To which we must add a perennial : upgrade of the data handling.

The current actuarial examination, in its 4th version, shows a marked improvement in the in the financial state of the Fund. In a year the financial cover of the Fund has increased by 3.7 percentage points thanks to the good performance of its investments … but in the event of the dissolution of the Organisation the cover would fall by 3.4 points and moreover indexation of pensions is not foreseen. Structural faults still exist whose causes must be sought in past decisions. CERN Council created in 2005 a protection mechanism for the Fund affecting the regulation of adjustment of pensions and increased contributons. Before the end of 2007, these dispositions must be confirmed or withdrawn. The actuaries have of course taken account of these provisions and have developed some 20 models to establish the impact of different parameters on the cover in 30 years' time.

In the matter of market turbulence, in June 2007 the Board authorised the investment committee considerably to reduce a portfolio of shares ; consequently the yield (on an annual basis) has remained at 7 to 8%.

To improve the somewhat out-of-date informatics system of the Fund and following the internal editing of a functional specification, the Board will appoint a group to choose between 3 possibilities :

This matter having been discussed several times without an acceptable solution emerging, the group will request an independent evaluation by a specialist firm. The report is expected in October.

Finally, let us note that the Geneva cost of living index for the period August 2006 / August 2007, used as a reference for adapting pensions in 2008, stands at 0%.

François WITTGENSTEIN, Jean-Claude GOUACHE

SCC Working Group on Pension Guarantees

(original French)

The work of the group has not advanced for over two years, with neither meetings nor reports.

The Juridicial service, the Staff Association and the Division of Human Resources all seem uninterested in investing efforts into the matter of guarantees of pensions.

It remains true that after the reimbursement by CERN of the debt to the Pension Fund, an important problem has been resolved, but the enthusiam to deal with the other important matters seems extinguished. There remains nonetheless the crucial question of the Health Fund. We must find a means of sustaining cover for Health-related expenses in the event of the dissolution of the Organisation.

Edith DELUERMOZ, Carlo VANDONI

Treasurer's Report

Profits and loss account 2006

Receipts 42'613.90 CHF
Expenses 49'311.23 CHF
Reserve -6'697.33 CHF

Subscriptions amount to 42'025.00 CHF
The Committee decided to contribute
13.50 CHF per member of GAC to
the Staff Association, i.e.
20'871.00 CHF
2007 Provisional budget
The provisional budget for 2007 amounts to 47'200.00 CHF

Members as on 1st September 1'698 persons

The minutes of the General Assembly of 30 march 2007 gives details of the budget.

Robert JACOB, Stephan PICHLER