GERMANY - The German Saxony region, which encompasses the cities of Leipzig, Dresden and Chemnitz, has confirmed it will top up its pension fund for civil servants with €500m.

Saxony's finance minister Stanislaw Tillich made the announcement on Monday, and stated with this injection the pension fund would have a capital value of €1.1bn at the end of this year.

The region will take the one-off payment from a tax windfall in order to improve the scheme's funding level, according to the minister's presentation.

The fund, managed by the Saxony finance ministry, will invest all its assets in public debt securities, bonds and notes.

Saxony set up the fund two years ago to secure the pensions of all civil servants who have been with the local government since 1997. According to the finance ministry, these amount to around 7,900 workers.

Retirement provisions for older civil servants will be paid from the current budget.

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