The components of net periodic benefit costs for our non-contributory qualified defined benefit pension plan (Primary Plan) and non-contributory supplemental pension plans were as follows:

 

Pension Plans Net Periodic Benefit Expense

		Primary Plan						Supplemental						Total
($ in millions)		Three Months Ended						Three Months Ended						Three Months Ended
		Oct. 29,			Oct. 30,			Oct. 29,			Oct. 30,			Oct. 29,			Oct. 30,
		2011			2010			2011			2010			2011			2010
Service cost	$	22		$	22		$	1		$	-		$	23		$	22
Interest cost		62			62			3			3			65			65
Expected return on plan assets		(97	)		(87	)		-			-			(97	)		(87	)
Net amortization		35			59			5			5			40			64
Net periodic benefit expense	$	22		$	56		$	9		$	8		$	31		$	64

 

 

 

Postretirement Health and Welfare Plan Net Periodic (Income)

($ in millions)			Three Months Ended						Nine Months Ended
			Oct. 29,			Oct. 30,			Oct. 29,			Oct. 30,
			2011			2010			2011			2010
Service cost		$	-		$	-		$	-		$	-
Interest cost			-			-			-			-
Expected return on plan assets			-			-			-			-
Net amortization			(6	)		(6	)		(19	)		(18	)
Net periodic (income)		$	(6	)	$	(6	)	$	(19	)	$	(18	)

 

 

Voluntary Early Retirement Program (VERP)

In August 2011, we announced a VERP under which approximately 8,000 eligible associates had between September 1, 2011 and October 15, 2011 to elect to participate.  For the approximately 4,000 associates who elected to accept the VERP, we incurred a total charge of $176 million for enhanced retirement benefits which was recorded in the line item "Restructuring and management transition" in the unaudited  Interim Consolidated Statements of Operations (see Note 10).  Enhanced retirement benefits of $133 million related to our Primary Plan decreased our overfunded status of the plan.  Enhanced retirements benefits of $36 million and $7 million related to our unfunded Supplemental Retirement Program (SRP) and the Benefit Restoration Plan (BRP), respectively, increased the projected benefit obligation (PBO) of the plans.  In addition, we also incurred curtailment charges totaling $1 million related to our SRP and BRP as a result of the reduction in the expected years of future service related to these plans.  Theses curtailment charges were recorded in the line item "Restructuring and management transition" in the unaudited Interim Consolidated Statements of Operations (see note 10).  As a result of these curtailments, the liabilities for our SRP and BRP were remeasured as of October 15, 2011.  The discount rate used for the October 15 remeasurements was 5.06% as compared to the year-end 2010 discount rate of 5.65%.  As of October 15, 2011, the PBOs of the SRP and BRP was increased by $71 million and $24 million, respectively.  As of October 29, 2011, the PBOs of our SRP and BRP was $216 million and $78 million, respectively.

 

Defined Contribution Plans

Our defined contribution plans include a qualified Savings, Profit-Sharing and Stock Ownership Plan (a 401(k) plan), which includes a non-contributory retirement account, and a non-qualified contributory unfunded mirror savings plan offered to certain management associates. Total expense for our defined contribution plans for the third quarters of 2011 and 2010 was $16 million and $13 million, respectively, and is predominantly included in SG&A expense in the unaudited Interim Consolidated Statements of Operations.  Total expense as of October 29, 2011 and October 30, 2010 was $48 million and $39 million, respectively.