The ACT government workers' superannuation fund is more than $450 million short of its budgeted earnings in the past five years, with the global financial crisis blamed for the shortfall.
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And the $2.2 billion fund, the retirement savings of the territory government's workers, is being put under even more more pressure by retiring workers living longer and drawing down more of their pensions, according to Treasurer Andrew Barr.
The investment fund, which is managed by several different commercial funds managers, has earned its members just $303 million since 2006-07, against a budgeted performance of $758 million.
During the two bleakest years of the crisis, 2007-08 and 2008-09, the fund lost more than $410 million, plunging the retirement dreams of the territory's 18,000 public servants into crisis.
Despite a better-than-expected recovery effort in the past two years, the fund has shown average returns over the five-year period of just over 3.5 per cent, way below the interest it would have earned in a bank account.
But Mr Barr said yesterday that there was no intention of adopting a no-risk investment strategy for the fund as the territory government pursues a policy of fully funding its superannuation commitments by 2031.
''If the question is why not put the lot in the bank now and remove that element of risk, we could potentially find ourselves with a lower rate of return,'' he said.
''It would depend on what had happened once we had made that decision.
''Some money has been parked in lower risk, lower return type investments.
''I was actually surprised to find out how low the percentage was of our investments that were exposed to share market fluctuations.''
The Treasurer said that this year's Government Actuarial Report would show the superannuation fund was coming under pressure from retiring workers taking their super in pension form - rather than a lump sum - and then living longer than the previous generations.
''Those who were on the older, more generous scheme, are taking pensions and then living longer,'' he said. ''Therefore the amount we have to provision for those superannuation payments is growing and that hits the budget bottom line.''
Mr Barr said that Treasury officials were keen to recoup the losses inflicted by the Global Financial Crisis. ''Since I've been Treasurer the conversations have been about a greater return from the current mix.''
''There has been a sense of need to recover some of those losses.''
But the recovery could not be attributed to any major changes in the fund's investment strategies, Mr Barr said.
