11 Mar 2011

Marshalls pension fund could be bankrupt by 2023

6:48 pm on 11 March 2011

The administrator of the Marshall Islands social security programme says it is being forced to use up all of its domestic investments to meet payments to retirees in 2011.

Saane Aho says this development puts it on track for bankruptcy by 2023.

She says benefits for Marshall Islands retirees are skyrocketing while tax collection is stagnant and thereby putting the retirement fund in jeopardy.

Ms Aho says in 2010 for the first time in 10 years, social security had to dip into local cash reserves to meet its deficit, and the problem is worsening.

She says without government action to change the system, the gap between tax revenue and benefits payments will continue to widen.