The bill to increase the government’s and members’ contributions to the American Samoa Government Employees Retirement Fund is now law.
Governor Lemanu Peleti Mauga signed it on Tuesday.
Passed in the last Fono session, the new law increases the combined contributions of ASG and employees from 11% to 14%, effective October 1st. ASG will contribute 10%, up from 8% and members will contribute 4%, up from 3%.
There will be incremental increases each year thereafter up to 2024.
For the last 10 years, actuary studies by the ASGERF advisors have shown that there’s a serious deficit between the money that goes into the Fund on a monthly basis and what is paid out.
They’ve predicted that if something is not done to fix this unfunded liability, the ASGERF would be bankrupt by 2040.
In 2021, a similar Senate bill proposed to increase ASG’s contribution to 11% percent and 5% from employees.
Governor Lemanu did not sign that bill and instead informed the Legislature that the proposed contributions were too high. He said, he will propose an alternative bill that is in the best interest of the people, at the same time aim to fulfill the critical need of reducing the shortfall in the Fund.
