Representative Vailoata Amituanai is moving to introduce legislation that would carry out a recommendation made more than a year ago by advisors and consultants of the American Smaoa Government Employees Retirement Fund ..to increase the employer and employee contributions or risk the Fund going bankrupt.
Vailoata is introducing a bill that would hike by 15% the combined employer and employee contribution to the Fund.
The employee contribution would be hiked by 2% to 5% percent and the employer contribution would be hiked from 8 to 10%.
It was brought out in Retirement Fund meetings with lawmakers and actuary reports that the deficit in what was being paid out in retirement checks and what was coming in via employer and employee contributions was eating up returns from Retirement Fund investments.
The actuary report presented at the February 2017 meeting in Honolulu showed that the funded status of the Retirement Fund was 46%.
After last year’s meeting of the Fono members and the Retirement Fund board and investment advisors in Honolulu, the Board Chairman announced in March that draft legislation had been submitted to the Governor’s Office to increase the contributions to 15%.
However up to now no such bill has been submitted by the administration to the Fono. Rep Amituanai who chairs the Retirement Fund Committee is now moving to introduce a bill to hike the contributions.
