19 Aug 2011

Tonga Government ends retirement fund subsidy

7:17 am on 19 August 2011

The parliament in Tonga has approved a bill terminating the government's annual subsidy of the administration costs of the public servants' retirement fund.

Since the launch of the scheme in 1998 the government has provided up to 181.5 thousand US dollars each year to help meet the salaries of the fund's board members.

The minister of finance, Sunia Fili, says after 13 years, the board is now generating sufficient profits through its investments.

"So this is the only year that they feel they have enough revenue for them to run with. So the government is asking them to let them do their own expenses while government retains the funds as savings for us."

Sunia Fili says the government will continue to pay its ten percent contributions to the fund.