Depressed stock prices, deficits in public pension programs nearly doubled to 10.1795 trillion yen in fiscal 2008 from the previous fiscal year, the welfare ministry reported Tuesday.
In addition, the national pension program for self-employed, unemployed, part-time workers and other people chalked up a red ink figure of 1.1216 trillion yen, the ministry said.
The deficits, based on market values, were the largest since fiscal 2001. Comparable data for the period before that was not available.
Both pension programs were in the red in fiscal 2007 as well. The deficit for the employees' pension program at that time came to 5.5909 trillion yen and the national pension program ran a loss of 777.9 billion yen.
The Ministry of Health, Labor and Welfare attributed the biggest losses mostly to investments in reserve funds. The global financial crisis that flared last September caused share prices to tumble.
The employees' pension program lost 8.7252 trillion yen through various market investments in fiscal 2008, and the national pension program was down 592.4 billion yen, the ministry said.
The reserve funds in both programs fell sharply to 116.6496 trillion yen for the employees' pension program, down 13.5314 trillion yen from fiscal 2007, and to 7.1885 trillion yen for the national pension program, down 1.2789 trillion yen.
As for revenues, the employees' pension program received premiums worth 22.6905 trillion yen in fiscal 2008, up 721.4 billion yen from fiscal 2007.
The higher revenue owed largely to the fact that 496,000 more people were in the program than in the previous year due to a relatively stable labor market at the beginning of fiscal 2008.
As for the national pension program, 752,000 fewer people paid premiums than in the previous year, mostly because many baby boomers reached an age and no longer had to pay them.
This was a main reason for the drop in the program's revenue for fiscal 2008 to 1.747 trillion yen, down 111.2 billion yen from fiscal 2007.
Because pension benefits are funded by both premiums and tax money, deficits in a single year will not immediately affect payouts.
"We have devised long-term prospects for pension financing, taking into consideration stock prices and other factors up until the end of last year," said a welfare ministry official.
"A balance between the burden and the payments will be maintained in the future," the official added.
However, if the economic slump continues for a prolonged period, pension benefits could drop in the future.
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