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Retirement bills set for floor debate
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Posted on May 15 2006
Amid a flurry of controversy, the leadership of the House of Representatives will formally endorse the Fitial administration’s proposed Retirement “reform and rescue” bill.
“We will introduce it as submitted by the administration,” said House Speaker Oscar M. Babauta yesterday.
He said that House Ways and Means Committee chair Crispin Ogo would be reviewing the bill for introduction.
Also, Babauta said the Senate leadership would handle the defined contribution plan bill.
“It’s the Senate leadership that will introduce that piece of legislation,” said the official.
The administration submitted two bills—the Defined Benefit Plan Rescue and Reform Act of 2006 and the Defined Contribution Plan Act of 2006.
The propose Rescue and Reform Act has been widely criticized for its goal to write off the government’s $124 million unfunded liability with the NMI Retirement Fund.
It also asks the Fund to buy $40 million worth of revenue bonds to rehabilitate the Commonwealth Utilities Corp.
At the same time, the bill aims to authorize the government to suspend its employer contribution for a time.
The other bill seeks to create a defined contribution program for new members and some eligible existing employees. This gets rid of the government’s unfunded liabilities since it would only deal with the actual contribution of members.
The administration said the Fund’s Defined Benefit Plan is only 46 percent funded.
It said the Fund’s unfunded liability totaled $552 million as of October 2004.
There are currently 8,000 Retirement members.
