By: L.N. Reklai
December 18, 2017 (Koror, Palau) President Tommy E. Remengesau Jr. disapproved the increase of Pension contributions as proposed by the Palau Civil Service Pension Plan Board of Trustees. [restrict]
Pension Plan Board of Trustees had proposed a 2% increase from individual contributors to the Pension Fund starting January 1, 2018 as means to save Pension Plan Fund. Pension Plan pay out more in benefits each quarter than it collects, requiring it to constantly draw from its investments to cover quarterly benefit payments.
President Remengesau Jr. in his letter to CSPP Board of Trustees agreed that “something must be done to shore up the Trust Fund”. He stated, ”However, raising employee contributions by 2% of gross pay would represent more than 30% increase on current contributions.” This, he added would have major impact on participants and their families.
Promising to convene national leadership in coming months to address this issue, Remengesau assured the Board of Trustees that they will continue to seek CSPP’s knowledge and expertise on the matter as they seek other solutions to the problem of making CSPP viable. [/restrict]