PBGC Grants $31.6M to Newspaper Drivers Pension Plan

The Ohio-based Newspaper Drivers Local 473 Plan will receive funding under the Special Financial Assistance Program.



The Pension Benefit Guaranty Corporation
has approved $31.6 million in Special Financial Assistance Program funds for the Retirement Benefit Plan of the Newspaper and Magazine Drivers, Chauffeurs and Handlers Union Local 473, an Ohio-based pension fund with 804 participants. 

The fund was expected to become insolvent in 2034. According to its Form 5500, the plan had $49 million in assets and a funded status of 79% as of 2022, the last available plan year.

The Local 473 plan, at risk of insolvency, applied for special financial assistance to avoid having to reduce participants’ benefits levels to the PBGC guarantee level upon insolvency of the plan.

“Many Americans have worked for decades toward the promise of a well-earned retirement after a lifetime of hard work,” said Julie Su, Acting Secretary of Labor, in a statement announcing the grant. “Today, the Biden-Harris Administration is delivering on that promise for the workers of Local 473 by providing Special Financial Assistance under the American Rescue Plan to ensure that they can retire with the dignity they deserve.”

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The Special Financial Assistance Program, enacted as a part of the American Rescue Plan in 2021, provides crucial funding to underfunded multiemployer pension plans at risk of insolvency.

As of August 16, the PBGC has approved $67.7 billion in funds through the Special Finance Assistance Program to plans covering 1.15 million beneficiaries, according to the PBGC.

Grants are calculated to ensure plan solvency through 2051.

Pension funds that receive PBGC assistance must monitor the interest resulting from the grant money as separate from other sources of funding. The PBGC requires that at least two-thirds of the money it provides be invested in “high-quality fixed income investments.” The Final Rule on Special Financial Assistance, issued in July 2022, states that the other third can be invested in “return-seeking investments,” such as stocks and stock funds.

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PSP Investments CIO van Gelderen Set to Depart

The investment chief since 2018 will step aside now, with his official departure set for October 1.

Eduard van Gelderen

Eduard van Gelderen, senior vice president and CIO of the Public Sector Pension Investment Board, will depart the fund after six years, the Canadian pension fund announced Wednesday.

van Gelderen’s official departure from PSP Investments will come on October 1, although he will step aside immediately from his day-to-day duties.
 

In the interim, Alexandre Roy, the senior managing director of PSP’s total fund management team, will take over van Gelderen’s responsibilities at the C$264.9 billion ($194.78 billion) pension fund.  

In a letter to colleagues seen by CIO, van Gelderen told PSP staff that over the next few weeks he would be supporting his wife with a newborn child, as well as finishing his PhD thesis. 

Van Gelderen joined PSP Investments in 2018. Previously, he was a senior managing director at the University of California’s investment office between 2017 and 2018. From 2014 to 2017, he was CEO of APG Asset Management, the asset management arm of Dutch pension fund ABP. He was previously CIO of capital markets at APG.  

Van Gelderen is also chair of the Alternative Investment Management Association’s Global Investor Board. He was a member of CIO’s Power 100 List in 2016.

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“I want to express my sincere gratitude to Eduard for his significant contributions to PSP over the years,” said Deborah K. Orida, president and CEO of PSP Investments, in a statement. “Eduard’s commitment to building diverse and inclusive teams has made us a stronger organization. His sponsorship and support of PSP’s anti-racism, culture, and religion affinity group will leave a lasting legacy. His contributions have been instrumental in our growth, and we wish him the very best in his future endeavors.” 

PSP Investments, one of the largest pension funds in Canada, manages the investments for federal public service employees in Canada, as well as members of the Canadian armed forces, the Royal Canadian Mounted Police and the Reserve Force. The fund has one- and five-year net annualized returns of 7.2% and 7.9%, respectively.  

The fund has seen other recent high-profile departures. Earlier this month, Jean-François Bureau, chief financial and risk officer at PSP Investments, announced his retirement from the fund, effective December 31. 

Related Stories: 

PSP Investments Returns 7.2% in Fiscal Year 2024 

PSP Investments Names Eduard van Gelderen CIO 

New CIO for APG as Kemna Switches Roles 

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