Acting Finance Minister Paula Cox last night hit back at claims that the Island's pension scheme was destined to collapse in future decades.

Ms Cox was responding to a speech made by businessman, author and economist Robert Stewart at the Rotary Club on Tuesday.

Mr. Stewart said the current pension plan was unworkable with huge problems looming for Bermuda's 30 and 40 year-olds who would get little reward in their ‘golden years' for contributions they are now making.

He made comparisons to other pension schemes around the world that are “almost at the point of bankruptcy''.

Ms Cox criticised what she described as inaccurate statements made in the speech that “may have created overly negative impressions of the state and future viability of the Contributory Pension Fund''.

She also took direct aim at Mr. Stewart's assertion that there was a large deficit in the scheme and that numbers could not be quantified since the last published figures for the Social Security Fund dated back to 1993.

“Government tabled the Contributory Pension Fund Financial Statements for the year ended July 31, 1999 and in May, 2002,'' Ms Cox said in a Press statement.

“The Minister said that financial statements for the 2000 and 2001 financial years will shortly be tabled in the House of Assembly and the most recent Actuarial Review of the Fund will be tabled soon thereafter.

“The most recent review was received in December, 2002.''

With seven types of benefits payable under the Contributory Pensions Act, the Minister said that the scheme was never intended to represent a retiree's sole source of income with other non-contributory benefits including for disability.

Private pension schemes were introduced in 1998 to ensure that employees now entering the labour force would be in a position to have sufficient levels of income in their retirement years.

“Government regularly reviews the financial performance of the Contributory Pension Fund and receives actuarial advice as to the long-term viability of the Fund,'' Ms Cox said.

“The Government has over the last several years increased contributions by some 1.25 percent more than benefit increases, in line with such actuarial recommendations so as to enhance the ability of the Fund to make payouts in the future.

“Based on the most recent review, it has been projected that the Fund will grow to over $1.6 billion by 2040, some 10 times the total projected payments in the same year. So contrary to the statements (made by Mr. Stewart), the Fund is positioned to grow considerably and be able to meet future benefit obligations.

“Government wishes to assure existing pensioners, and those who are due to receive CPF pension benefits in the near future, that the Fund is in good shape and is able to meet its obligations.''