The financial crisis in the US has cost the civil servant retirement fund more than NT$300 million (US$9.3 million), Minister of Civil Service Chang Che-chen (張哲琛) said yesterday.
Chang said the bankruptcy of Lehman Brothers cost the fund more than NT$38 million. Another NT$276.5 million was lost after the takeover of investment bank AIG and an additional NT$54 million in the subprime credit crunch, he said
While the government has activated the National Stabilization Fund to support the stock market, Chang said the money did not come from the civil servant retirement fund.
Chang made the remarks at the legislature’s Judiciary, Organic Laws and Statutes Committee yesterday.
He said that since the civil servant retirement fund was established in 1995, NT$495 billion had been paid into it as of last month against total expenses of about NT$162 billion.
Chang said the fund receives about NT$4.6 billion each month, or NT$53 billion a year. Annual expenses are about NT$24 billion.
Aside from bank deposits, Chang said funds had been channeled into local and international investments.
From July 1, 1995 to last month, the net profit of the fund’s investment was NT$55.8 billion. This year, however, the fund had lost NT$26.7 billion as of last month.
While Chang’s predecessor, Chu Wu-hsien (朱武獻), was criticized for being personally involved in the fund’s investment in the stock market, Chang yesterday said he would spend 70 percent of his working day dealing with the ministry’s affairs and 30 percent attending to the fund’s investment.
He also promised to stop using ineffective investment companies.
During Chu’s tenure, he irked the legislature by proposing reform of the 18 percent preferential interest rate on the savings of teachers, civil servants and soldiers.
Chu is under investigation by the Control Yuan and prosecutors after media allegations that his management had led to massive losses for the Civil Servants Pension Fund.
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