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Pension and Postretirement Benefit Plans | 9 Months Ended
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Sep. 30, 2018
Retirement Benefits [Abstract] |
Pension and Postretirement Benefit Plans | Pension and Postretirement Benefit Plans
The following table provides the components of net periodic benefit cost/(credit):
|  | Three Months Ended
|  | Pension Plans |  |
|  | U.S. Qualified(a) |  | U.S. Supplemental (Non-Qualified) |  | International |  | Postretirement Plans
(MILLIONS OF DOLLARS) |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |
Net periodic benefit cost/(credit)(b): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Service cost(c) |  | $ | — |  |  | $ | 67 |  |  | $ | — |  |  | $ | 6 |  |  | $ | 33 |  |  | $ | 44 |  |  | $ | 10 |  |  | $ | 10 |
Interest cost |  | 149 |  |  | 157 |  |  | 14 |  |  | 13 |  |  | 52 |  |  | 52 |  |  | 18 |  |  | 23 |
Expected return on plan assets |  | (259 | ) |  | (248 | ) |  | — |  |  | — |  |  | (89 | ) |  | (87 | ) |  | (9 | ) |  | (9 | )
Amortization of: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Actuarial losses(c) |  | 30 |  |  | 91 |  |  | 3 |  |  | 12 |  |  | 25 |  |  | 29 |  |  | 2 |  |  | 8 |
Prior service credits |  | — |  |  | — |  |  | — |  |  | — |  |  | (1 | ) |  | (1 | ) |  | (45 | ) |  | (45 | )
Curtailments |  | 1 |  |  | 1 |  |  | 1 |  |  | — |  |  | (4 | ) |  | (2 | ) |  | (1 | ) |  | (3 | )
Settlements |  | 38 |  |  | 30 |  |  | 3 |  |  | 7 |  |  | — |  |  | — |  |  | — |  |  | — |
|  | $ | (40 | ) |  | $ | 99 |  |  | $ | 20 |  |  | $ | 39 |  |  | $ | 17 |  |  | $ | 35 |  |  | $ | (26 | ) |  | $ | (17 | )
|  | Nine Months Ended
|  | Pension Plans |  |
|  | U.S. Qualified(a) |  | U.S. Supplemental (Non-Qualified) |  | International |  | Postretirement Plans
(MILLIONS OF DOLLARS) |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |  |  | Sep 30, 2018 |  |  | Oct 1, 2017 |
Net periodic benefit cost/(credit)(b): |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Service cost(c) |  | $ | — |  |  | $ | 202 |  |  | $ | — |  |  | $ | 18 |  |  | $ | 104 |  |  | $ | 127 |  |  | $ | 29 |  |  | $ | 32 |
Interest cost |  | 450 |  |  | 478 |  |  | 40 |  |  | 41 |  |  | 160 |  |  | 152 |  |  | 54 |  |  | 68 |
Expected return on plan assets |  | (783 | ) |  | (759 | ) |  | — |  |  | — |  |  | (274 | ) |  | (256 | ) |  | (28 | ) |  | (27 | )
Amortization of: |  |  |  |  |  |  |  |  |  |  |  |  |  |  |  |
Actuarial losses(c) |  | 90 |  |  | 302 |  |  | 10 |  |  | 37 |  |  | 77 |  |  | 86 |  |  | 5 |  |  | 23 |
Prior service costs/(credits) |  | 1 |  |  | 3 |  |  | (1 | ) |  | (1 | ) |  | (3 | ) |  | (3 | ) |  | (135 | ) |  | (137 | )
Curtailments |  | 11 |  |  | 10 |  |  | 1 |  |  | — |  |  | (4 | ) |  | (2 | ) |  | (15 | ) |  | (15 | )
Settlements |  | 84 |  |  | 54 |  |  | 24 |  |  | 32 |  |  | — |  |  | 3 |  |  | — |  |  | — |
|  | $ | (147 | ) |  | $ | 292 |  |  | $ | 75 |  |  | $ | 127 |  |  | $ | 61 |  |  | $ | 106 |  |  | $ | (89 | ) |  | $ | (57 | )
(a) | In the second quarter of 2017, we settled the remaining obligation associated with the Hospira U.S. qualified defined benefit pension plan. We purchased a group annuity contract on behalf of the remaining plan participants with a third-party insurance provider. As a result, we were relieved of the $156 million net pension benefit obligation and recorded a pre-tax settlement gain of $41 million, partially offset by the recognition of actuarial losses and prior service costs upon plan settlement of approximately $30 million in Other (income)/deductions––net (see Note 3).
(b) | We adopted a new accounting standard on January 1, 2018 that requires the net periodic pension and postretirement benefit costs other than service costs be presented in Other (income)/deductions––net on the condensed consolidated statements of income. For additional information, see Note 1B and Note 4.
(c) | Effective January 1, 2018, we froze two significant defined benefit pension plans to future benefit accruals in the U.S. and U.K. and as a result, service costs for those plans are eliminated. In addition, due to the plan freeze, the average amortization period for the U.S. qualified plans and U.S. supplemental (non-qualified) plans was extended to the expected life expectancy of the plan participants, whereas the average amortization period in prior years utilized the expected future service period of plan participants.
The following table provides the amounts we contributed, and the amounts we expect to contribute during 2018, to our pension and postretirement plans from our general assets for the periods indicated:
|  | Pension Plans |  |
(MILLIONS OF DOLLARS) |  | U.S. Qualified |  | U.S. Supplemental (Non-Qualified) |  | International |  | Postretirement Plans
Contributions from our general assets for the nine months ended September 30, 2018 |  | $ | 500 |  |  | $ | 118 |  |  | $ | 174 |  |  | $ | 108 |
Expected contributions from our general assets during 2018(a) |  | 500 |  |  | 137 |  |  | 229 |  |  | 149 |
(a) | Contributions expected to be made for 2018 are inclusive of amounts contributed during the nine months ended September 30, 2018, including the $500 million voluntary contribution that was made in February 2018 for the U.S. qualified plans, which was considered pre-funding for future anticipated mandatory contributions and is also expected to reduce Pension Benefit Guaranty Corporation variable rate premiums. The U.S. supplemental (non-qualified) pension plan, international pension plan and the postretirement plan contributions from our general assets include direct employer benefit payments.

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