_418 2023 UNIVERSAL REGISTRATION DOCUMENT_MICHELIN 5 FINANCIAL PERFORMANCE 2023 consolidated financial statements In France, the pension reform of April 14, 2023 (Act 2023-270) had the effect of reducing the Group’s employee benefit obligations by €13 million. This amount is recorded as a deduction from the related provision under “Plan modifications, curtailments or settlements”. In France, the voluntary early retirement and outplacement measures provided for in the third Collective Settlement Agreement (Accord de Rupture Conventionnelle Collective 3, see note 9.2.2) had the effect of reducing the Group's pension obligations by €62 million and its other post-employment benefit obligations by €56 million in 2022. For Canadian pension plans, the Group does not have any rights to a refund of the plan surplus. The available economic benefits are measured as the present value of the future service cost. These pension plans are subject to a minimum funding requirement. The surplus recognized as an asset is the sum of: ● any prepaid amount that would reduce the future minimum funding requirement; and ● the estimated future service cost in each period less the estimated minimum funding requirement contributions that would be required for future service. Any amount exceeding this limit is immediately recognized within other comprehensive income. In 2023, an amount of €5 million was recognized on application of the asset ceiling. The main actuarial weighted average assumptions used to measure projected benefit obligations are as follows: December 31, 2023 December 31, 2022 United Kingdom (UK) Europe excluding UK North America United Kingdom (UK) Europe excluding UK North America Discount rate 4.65% 3.20% 4.76% 4.95% 3.66% 5.01% Inflation rate 3.15% 2.02% 2.18% 3.35% 2.22% 2.37% Rate of salary increases* 3.23% 3.12% 3.50% 3.43% 3.10% 3.50% Weighted average duration of the defined benefit obligation 11.2 13 9.1 12.8 13.5 9.7 * North America: only the Canadian pension plan is concerned by this assumption, for a non-material group of members. Assumptions concerning healthcare cost trends are as follows: December 31, 2023 December 31, 2022 United States Canada United States Canada Expected growth in healthcare costs in the first year 7.95% 4.91% 7.85% 4.69% Minimum long-term rate of annual growth in healthcare costs 4.50% 4.05% 4.50% 4.05% Year in which the minimum growth rate will be achieved 2033 2040 2030 2040 Regarding the sensitivity of the fair market value of plan assets due to interest rate movements, it is considered that the entire yield curve moves up or down by 0.5 point and that only the values of the bonds are impacted, with the values of all other assets remaining unchanged. The level of sensitivity indicated corresponds to the change in the total value of the portfolio due to the change in interest rates.
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