Less reliance on the stock markets has saved the Public Pension Funds "significant amounts in investment losses", according to the Finance Minister.

Since Government diversified its strategy, Minister Paula Cox says the funds have become "more balanced".

Investment performance last year showed the Contributory Pension and Superannuation Plans rose by up by a fifth at 20.8 percent and 21 percent respectively. This places them in the 34th and 32nd percentile of Public Funds. At the end of 2009, the Contributory Pension Fund assets were $1,206.9 million ($1.2 billion) an increase of $231 million.

The Public Service Superannuation Fund's assets totalled $397.7 million a rise of $72.2 million.

Deputy Premier Ms Cox said: "I think it important to note that 2009 was a favourable year for asset returns, following the extreme market dislocations in late 2008."

She said: "It is pleasing to note that Government's investment strategy for pension fund assets is achieving decent results. In 2001, the Government, under the advice of the Public Funds Investment Committee and our investment consultant, implemented an asset diversification strategy which substantially reduced the prior strategy's exposure to the publicly traded stock markets."

This diversified investment in both global stock and bond markets, and added alternative investment strategies, thereby improving risk-adjusted returns.

Ms Cox said: "The implementation of the strategic plan, in particular, the decision to reduce the public funds exposure to the equity markets from 72 percent in 2005, to the current level of 47.5 percent, has saved the public pension funds significant amounts in investment losses.

"I would like to commend the Public Funds Investment Committee, the technical officers from the Ministry of Finance and Accountant General's Department, the Bermuda Monetary Authority and our investment consultant, New England Pension Consultants, for their sterling work in providing prudent oversight of the investments held in trust in respect of the Public Funds."