Pago Pago, AMERICAN SAMOA — Senate President Tuaolo Manaia Fruean has questioned how the Lemanu & Talauega Administration will fund the new government minimum wage increases and other pay hikes and voiced concerns on effect the impact of the new ASG minimum wage will have on the private sector, which is closely monitoring these financial developments.

Tuaolo’s questions and concerns came during his response after Gov. Lemanu Peleti Palepoi Sialega Mauga’s special remarks on Monday at a joint session of the Fono for the opening of the Second Regular Session of the 37th Legislature.

Among the many topics that the governor highlighted in his address delivered in Samoan is the new minimum wage for government workers increasing from $5.51 per hour to $7.25 per hour — or a salary of about $15,080 per year.

The governor’s “executive summary” final budget for FY 2022 report distributed to lawmakers on Monday also addresses the minimum wage increase and other changes to the pay scale in government service.

“With the increase in cost of living together with family and church obligations, it’s important for our people who feel hopeless and think that there is no other way to advance must earn enough to support their families,” the governor noted. “We feel your pain and understand your struggles.”

“It is with conviction that I believe it’s about time to give those at the bottom a break by raising the minimum wage up to $7.25 per hour,” he said, noting that the new pay scale plan, which was effective July 1st, was based on General Memorandum 121-21 for ASG.

He explained that compensation thresholds for general ASG workforce degree holders — non-educators — for those with AA degrees is $19,000; BA is $28,000 and MA is set at $35,000.

“The new classifications will include step increments and years of service promotions for the majority, if not all of the career service employees,” he said, and pointed out that any contract employee below the current minimum wage will be adjusted up to the new one.

Speaking to lawmakers, Lemanu said budgets for the Governor’s Office and the Fono have been reduced to fund the wage increases which are included in the new fiscal year 2022 proposed budget submitted to the Legislature.

Tuaolo, who responded to the governor’s address on behalf of the Fono, acknowledged with appreciation the many developments mentioned by the governor. He noted that Administration officials should be available when the time comes for the Fono to review the FY 2022 budget to answer questions pertaining to the salary increases and funding.

While pay increases are now implemented, Tuaolo said local revenues remain the same at $110.16 million as the current fiscal year. He said local revenue should be increased, so there is additional money for the pay hikes for the new minimum wage threshold.

However, if such increases are covered by grants, then the administration can explain later on how that will happen during budget hearings.

The Senate President also raised concerns on the affect the hike in government minimum wage will have on local businesses, as to whether the private sector can afford to compete with the government sector. He is concerned with businesses having to close operations as they can’t compete with the government sector.

Samoa News notes that the next federally required minimum wage hike of 30 cents per hour for all sectors in the territory goes into effect on Sept. 30th this year. There are different minimum wages for the 17-different sectors in the territory.

A handful of business operators have told Samoa News that the “drastic” hike in the government minimum wage — instead of the gradual mandatory 30-cent per hour by the feds — is expected to entice more workers in the private sector to seek jobs in government.

Another concern from businesses is degree holders — non-educators — will be more interested in working for government now that their pay scale has been hiked as well.

HEALTH ISSUE

With the millions of dollars of federal money coming to American Samoa, especially through federal COVID-19 relates funds, Tuaolo believes that the territory should be top in the region when it comes to heath care service.

Despite the large sums of money, he said the number of dialysis patients continues to increase and many local residents are dying from cancer. Tuaolo suggested that the Health Department and LBJ Medical Center conduct a study on these diseases and use funding — these large sums of money — to improve the territory’s health care system.