No word on increasing Retirement Fund contributions as gov signs bill that changes composition of board
Pago Pago, AMERICAN SAMOA — Gov. Lemanu Peleti Mauga signed into law last Friday, Oct. 14th, a Fono approved bill, which originated from the Senate that amends local laws to allow the local government to staff the ASG Employees Retirement Fund (ASGERF) board of directors with an additional member who is also a member of the Retirement Fund.
The governor informed Fono leaders that he has signed the bill into law in an Oct. 14th letter, and there was no other comments provided in the communication.
Under current law, there are seven members of the Board of Trustees for the Fund, with at least four members, who shall be members of the Fund having at a minimum five years of service; and three members who shall not be members of the Fund but shall include among them at least two members with experience in the private sector/ business community.
The newly enacted law, changes the board’s composition with at least “five” members who are members of the Fund, and “two” members who “have” experience in the private sector/ business community.
ASERF board members are appointed by the governor and confirmed by the Legislature.
The bill’s preamble points out that it’s imperative to have a fully staffed Board of Directors for the Retirement Office in order to conduct business and it’s “incredibly important” these board members “be fully invested in protecting the Retirement Fund and helping it to grow.”
And “to ensure members who are fully invested in the Retirement Fund, it is essential that they are actual members of the Retirement Fund with their own retirement accounts.”
Furthermore, members of the Board of Directors of the Retirement Fund who have their own money in the Fund will be “absolutely motivated to do all they can to ensure the success of the Retirement Fund.”
The now enacted legislation, was sponsored by Senate President Tuaolo Manaia Fruean — who is also a member of the ASGERF Board of Trustees. And there have been calls over the years from Fund members to have more representation on the board.
Meanwhile, there is no official communication from the Administration on the governor’s decision dealing with a second-approved Fono bill, which seeks to increase the contribution rate for both government and employees to the ASGERF by adding a “3% increase” to ASG’s contribution from the current 8% while the members’ contribution goes up from 3% to “5%”.
Several ASG employees are waiting for word on the governor’s action on this legislation, which also originated from the Senate, because the hike in the contribution rate, will decrease their take-home pay.
Some lawmakers had argued during committee debates that the recent ASG pay hike — which was effective in July this year — would have no major impact on the increase in contributions by employees. Additionally, the hike in Retirement Fund contributions would benefit ASG workers in the future.