US - The US$388m Public Service Superannuation Fund (PSSF) will pay out an additional US$2m a year, after the senate approved a 6.5% increase in Bermuda civil service pension pay.
The move sparked funding concerns because The PSSF is not funded by government and therefore increases would have to be recuperated through increases in employee contributions.
Independent senator Walwyn Hughes was quoted as saying: “Someone has to provide contributions into the scheme to pay for those pension increases. This means a large part of people’s salaries will have to go into their contribution to make the system work.”
PSSF contribution rates increased from 5% to 6% in April this year and were forecast to rise to 7% in 2007 and 8% in 2008 for regular members. Uniformed officers were expected to be paying 9.5% of their wages into the fund by 2008.
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