Fund record defended

Pension funds are not cashing in on their investments early so they can cover financial shortfalls, the government said yesterday, while insisting that the wealth of the funds had risen by more than 40 percent since New Democracy came to power in 2004. Labor Minister Savvas Tsitouridis denied claims that some funds had liquidated their bonds before the investments had matured in order to have enough money to pay out pensions to their retired members. Tsitouridis said there is no basis for such claims because the state is currently obliged to guarantee the funding of public pension funds. Government spokesman Theodoros Roussopoulos said the reserves of pension funds had grown over the last three years. He said that the funds had a combined wealth of 21 billion euros three years ago and that this had risen to 31 billion euros this year – an increase of 42.5 percent. The government has been heavily criticized for its handling of pension funds after it was revealed that a civil servants’ fund had overpaid by around 5 million euros for a bond last month. That purchase, as well as other bond sales to pension funds, is being investigated by the money-laundering committee amid suspicions that a number of companies profited from being part of a long chain of firms that traded the bond. «A government which moves so quickly and in such a transparent way shows that it is aware of its political responsibility and proves it in practice,» said Roussopoulos. However, an opinion poll made public on Sunday indicates that many voters do not think that the government has done enough by simply ordering a probe into the transaction. Eight in 10 Greeks think the bonds issue is an important one and 41 percent believe that the government carries full responsibility for the problems. åGovernment sources said that the conservatives will continue to follow a two-track approach to dealing with the matter: They will fully support the independent investigation while also being open to changing the law on how pension funds are run. They have already announced that the presidents of pension fund boards will no longer be appointed by the government.

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