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Fund: Only central govt behind in contribution
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Posted on Jun 09 2005
Only the central government is behind in remitting the employer’s contribution to the NMI Retirement Fund, according to a Fund official, who said the government’s arrears now total $80 million.
Fund administrator Karl T. Reyes said autonomous agencies like the Public School System, Northern Marianas College, Marianas Public Lands Authority, and Commonwealth Ports Authority, among others, remit their contributions on time.
“We’ve got no problem with agencies. They send us their employer’s contribution,” said Reyes.
He said only those agencies covered by the Department of Finance has fallen “terribly behind” schedule. These are the Executive Branch—the Governor’s Office and the departments under it—Legislature, Judiciary, and municipal governments.
From December 2001 to May 15, 2005, these agencies’ debt in employer contributions totaled $80.8 million.
In a recent report, Finance Secretary Fermin M. Atalig said that payments to the Fund were current until June 1998 when a series of outside events such as Asian currency crisis resulted in reduced government revenue—from nearly $250 million a year to $213 million or less.
Atalig said the government paid the oldest liabilities first, which covered FY 1998 to FY 2001. “We are now paying FY 2002 liabilities,” he said.
He said the government paid $18 million in FY 2004 and $8.8 million for FY 2005 ending in March.
In his State of the Commonwealth Address last month, Gov. Juan N. Babauta said that the government had failed to pay for retirement in 2000 and 2001.
“Now, every month we pay retirement: enough to cover the checks for every government retiree,” he had said.
The administration pays the Fund $850,000 every pay period for employer contribution.
Despite the mounting debt owed the Fund, the governor still considers the retirement system “safe,” noting that the system still has $400 million in assets in the bank.
Reyes said the central government’s average annual contribution to the Fund totals $24.4 million while the autonomous agencies’ remittances amount to $15.2 million.
The government shoulders 24 percent in employer contribution.
There are some 5,000 active members of the Retirement Fund.
