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Notes to the Consolidated Financial Statements
Years ended December 31, 2008 and 2007 (In thousands of dollars, except per share amounts)

The elements of the Company’s defined benefit plan costs recognized in the year are as follows:

    Pension and RCA plans           Other benefit plans
As at December 31   2008   2007   2008   2007
Current service cost $ 2,023 $ 2,003 $ 763 $ 1,200
Interest cost   3,295   2,944   559   692
Actual return on plan assets   5,106   (3,284)   -   -
Plan amendments   -   -   -   (4,933)
Actuarial losses (gains)   (9,249)   (1,854)   (1,540)   (535)
    1,175   (191)   (218)   (3,576)
Elements of employee future benefit costs before adjustments to recognize the long- term nature of employee future benefit costs:
                 
Difference between expected return                
and actual return on plan assets for the year (a)                
  (8,292)   628   -   -
Difference between actuarial (gains)                
losses recognized for the year                
and actual actuarial (gains)                
benefit obligations for the year (b)   9,474   2,209   1,588   590
Difference between amortization of                
past service costsfor the year                
and actual plan amendments                
for the year (c)   135   99   (398)   4,839
Difference between costs arising in                
the period and costs recognized                
in the year in respect of                
transitional obligation (asset)   14   15   -   -
                 
Net benefit plan expense $ 2,506 $ 2,760 $ 972 $ 1,853
                 
(a) Expected return on plan assets of $3,186 (2007 – $ 2,656) less the actual return on plan assets of $(5,106) (2007 – $ 3,284).
(b) Actuarial (gain) loss recognized for the year of $225 (2007 – $355) less the actual actuarial (gain) loss on accrued benefit obligation of $(9,249) (2007 – $(1,854)).
(c) Amortization of past service costs for the year of $135 (2007 – $99) less the actual plan amendments for the year of $nil (2007 – $Nil).

The significant actuarial assumptions adopted in measuring the obligation are as follows (weighted average):

         
    Pension and RCA plans           Other benefit plans
As at December 31   2008   2007   2008   2007
                 
Discount rate   6.80%   5.65%   6.80%   5.65%
Rate of compensation increase   3.75%   4.00%   3.75%   n/a
Expected long-term rate of return on                
plan assets   6.10%   5.60%   n/a   n/a
                 

The assumed health care cost trend rate at December 31, 2008 was 7.1% (2007 – 8.5 %), decreasing to 4.8% (2007 - 4.9%) over 8 years (8 years in 2007).

Increasing or decreasing the assumed health care cost trend rates by one percentage point would have the following effects for 2008:
                 
            Increase   Decrease
Total of service and interest cost         $ 349 $ (265)
Accrued benefit obligation         $ 1,812 $ (1,416)
                 

In 2008, the Company contributed and expensed $2,152 (2007 – $1,980) to the defined contribution tier, which amounts are not included in the recognized defined benefit costs above.

The average remaining service period of the active employees covered by the pension plans is 13 years (2007 – 13 years). The average remaining service period of the active employees covered by the other retirement benefits plans is 18 years (2007 – 18 years).

MX has provided a letter of guarantee in the amount of $2,093 to the benefit of the trustee of the MX employee future benefit plan, using a part of the operating line of credit in place with its bank (note 13).

 

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