GE 2014 Annual Report Download - page 38

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How We Address Social Costs
“We’ve taken signifi cant actions to control rising pension and healthcare costs,
but this remains an area of focus for GE as we continue to balance the interests of
our shareowners, employees and retirees.”
Jeff Immelt, Chairman of the Board & Chief Executive Offi cer
’00 ’05 ’10 ’14
$0.0B2
$3.2B
$4.4B
$6.4B Cost increase drivers
• Declining interest rates
• Volatile fi nancial markets
• Healthcare cost infl ation
PENSION & HEALTHCARE
PLANS PRE-TAX EXPENSE1
Major GE actions to address rising
pension & healthcare costs
• Annually…negotiated healthcare supplier contracts
• 2005/2008…changed new hire retiree health benefi ts
• 2009…stratifi ed retiree health benefi ts for
salaried employees
• 2011…implemented Medicare-approved prescription
drug plan
• 2011/2012…moved to a defi ned contribution
retirement plan for new hires
• 2012...announced closing of retiree health plans to
salaried employees and pre-65 retirees (effective 2015)
• 2014…introduced private exchanges for salaried
Medicare-eligible retirees
1 Includes global pension plans, U.S. Retirement Savings Plan & U.S. principal employee/retiree health plans.
2 In 2000, primarily because of its funded status, GE Pension Plan pre-tax earnings offset the cost of the other plans included in this chart.
3 Includes GE Pension Plan & principal retiree health plans.
4 Refl ects GE’s estimate of liability reduction, based on GE actions as of December 31, 2014.
5 For a discussion of the assets associated with these liabilities, see Other Consolidated Information—Postretirement Benefi t Plans on page 62 and Note 12 to the consolidated
fi nancial statements in this Form 10-K Report.
U.S. RETIREMENT PLANS
LIABILITY3
Projected benefi t obligation5
Liability reduction4
’19F
’14
$75B ~$75B
’09
$57B
$85B ~$90B
$60B
’24F
~$100B
~$70B
18 GE 2014 FORM 10-K