The German state of Lower Saxony has said it will introduce a new fund to back the pensions promises made to its civil servants, becoming the latest in a series of German states to do so. A new academic study has been published this week, recommending the idea and calling for such funds to invest in stocks and real estate, as well as the traditional fixed income.

Lower Saxony, or Niedersachsen, will begin to pay into a new fund for every new employee that joins from 2010, according to a spokesman. Other states that have also taken this step include Rhineland-Palatinate, in 1996, and Saxony, in 2005.