asrTrust

The Auto Sector Retiree Health Care Trust (asrTrust) provides health care benefits for the retirees of Chrysler Canada Inc. (CCI) and General Motors of Canada Ltd. (GMCL), represented by the CAW. The Trust also covers spouses and other dependents of retirees. Current unionized employees, active as of May 4, 2009 for CCI employees and June 8, 2009 f... or GMCL employees, will come under the Trust when they retire. Essentially, asrTrust took over responsibility for the retiree health care plans initially set up by CCI and GMCL. asrTrust maintains a separate trust account for each retiree plan under its administration. asrTrust is unique in Canada. While there are other health care trusts, asrTrust is the first one funded largely by a one-time contribution from the original plan sponsors. The only ongoing funding will be from the monthly contributions of retirees. These member contributions cover only a small part of the total cost of benefits. asrTrust's Board of Trustees therefore faces a unique challenge: they must do everything possible to ensure that the one-time payments last for decades. This means earning the most we safely can on our investments without unduly jeopardizing financial security. This also means keeping a close eye on benefit costs, which may have to be adjusted if they outpace investment earnings. Ultimately, entitlement to benefits is limited to the assets in the Trust. Therefore the Trustees have the power to change or even terminate benefits. asrTrust is also subject to compliance with applicable legislation, including the Canada Income Tax Act, which was amended to accommodate asrTrust by creating a new entity defined as an "employee life and health trust" or "ELHT". The ELHT provisions of the Income Tax Act specify conditions to be met by asrTrust, including the persons eligible to participate in the ELHT and the type of benefits it can provide. The Trustees are obligated to ensure that asrTrust always complies with the ELHT provisions. As such, benefits provided and eligibility to ...Read More