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A £10m shortfall in the Isle of Man's National Insurance fund has signalled a "turning point" in the Manx welfare state, the treasury minister said.

The government said state pension spending exceeded NI contributions for the second year running.

The fund went into deficit for the first time in 2012/2013, with a shortfall of £14 million.

Minister Eddie Teare said: "It's confirmation the island has reached a turning point in its welfare system."

He added: "We must now start to make changes to ensure that our social security system is sustainable, fair and that it does not put an undue burden on future generations".

A government spokesman said this year's shortfall was covered by a transfer from the fund's investment income.

In May a report from the UK Government Actuary's Department (GAD) estimated that unless changes were made, the Manx NI Fund would be exhausted by 2054.