The total expense for the Company’s defined contribution plan is $7 million for the year ended December 31, 2001 (2000 – $8 million). Information about the Company’s defined benefit plans, is as follows. The significant weighted average actuarial assumptions adopted in measuring the Company’s accrued benefit obligations and net benefit plan expense as at December 31 are as follows. For measurement purposes, an 8.8 per cent annual rate of increase in the per capita cost of covered health care benefits was assumed for 2002. The rate was assumed to decrease gradually to 4.0 per cent for 2005 and remain at that level thereafter. The Company’s net benefit plan expense is as follows. Year ended December 31  (millions of dollars) Prior to January 1, 2000, the cost of post-employment benefits other than pensions was expensed when paid. Pension expense of $14 million for the year ended December 31, 1999 includes the expense related to both the Company’s defined benefit and defined contribution pension plans. 1 Employee termination benefits related to restructuring are included in restructuring and other costs (see Note 18). TRANSCANADA 60 NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (millions of dollars) Pension Benefit Plans Other Benefit Plans 2001 2000 2001 2000 Change in Benefit Obligation Benefit obligation – beginning of year 644 626 55 48 Current service cost 12 15 2 2 Interest cost 41 44 4 3 Employees’ contributions 1 1 – – Benefits paid (59) (55) (3) (3) Actuarial loss 20 52 2 6 Transfers to defined contribution plan – (35) – – Corporate restructuring giving rise to curtailments – (4) – (1) Benefit obligation – end of year 659 644 60 55 Change in Plan Assets Plan assets at fair value – beginning of year 612 652 – – Actual return on plan assets (8) 34 – – Employer contributions 27 23 3 3 Employee contributions 1 1 – – Benefits paid (59) (55) (3) (3) Transfer to defined contribution plan – (43) – – Plan assets at fair value – end of year 573 612 – – Funded status – plan deficit (86) (32) (60) (55) Unamortized net actuarial loss 123 65 7 6 Unamortized transitional obligation related to regulated business – – 29 31 Accrued benefit asset/(liability), net of valuation allowance of nil 37 33 (24) (18) Pension Benefit Plans Other Benefit Plans 2001 2000 2001 2000 Discount rate 6.75% 6.80% 6.85% 6.90% Expected long-term rate of return on plan assets 7.10% 7.24% – – Rate of compensation increase 3.50% 3.50% 3.50% 3.50% Pension Benefit Plans Other Benefit Plans 1 2001 2000 2001 2000 Current service cost 12 15 2 2 Interest cost 41 44 4 3 Expected return on plan assets (41) (45) – – Amortization of transitional obligation related to regulated business  – – 2 2 Corporate restructuring giving rise to curtailments – (5) – – 12 9 8 7 Net benefit plan expense – discontinued operations (2) (2) – – Net benefit plan expense – continuing operations 10 7 8 7