Bill on bonus scrap on track: Senator

A bill seeking to repeal the 30 percent retirement bonus for government employees in line with the current austerity measures is still pending in the Senate and its passage has been clouded by concerns over specter of massive resignation.

Senate Vice President Thomas P. Villagomez, author of the proposed legislation, yesterday said he would press ahead with the plan to help the government save badly needed revenues.

But two members of the House of Representatives earlier have warned against the move, saying it may spark long lines of government personnel resigning from civil service to avail of the retirement benefits before it is removed.

“We’re looking at that issue. I’m still pushing for that but there are some concerns that we need to consider,” Villagomez said in an interview.

He also acknowledged the need for the NMI government to tighten its fiscal spending in view of the worsening economic crisis on the island that is anticipated to pull down revenue estimate by 13.4 percent less than earlier projections.

Finance officials had requested the legislature to repeal or suspend implementation of laws seen to impact on local coffers, including the 30 percent bonus given to government employees after 20 years of service.

As of October this year, some 256 civil service employees are eligible to retire and receive the lumpsum equivalent to 30 percent of their annual salary, according to the Retirement Fund office.

Villagomez said if these workers opt to retire, a lot of positions will be left vacant and contribute to the cost-cutting measures without laying off any of the government personnel.

About 75 percent of the entire $216.75 budget for 1999 are appropriated for payroll of the nearly 5,000 government employees and business leaders and some lawmakers say huge savings will be realized if the bloated bureaucracy is trimmed down.

“When they retire and the position is not really needed, the government is going to save if it doesn’t fill the vacancies,” Villagomez said.

He added that CNMI will also benefit if those non-productive government employees resign. “We may lose those hardworking individuals who are planning to retire… but at least those people that are not productive, I hope they realize that it’s going to be continued waste.”

The Tenorio administration has implemented austerity policy since January this year because of the economic crisis plaguing the Northern Marianas, its worst in years, and spawned by the financial turmoil in Asia, its main tourism market.