KOROR (Island Times/Pacnews) — Palau's National Congress, the Olbiil Era Kelulau or OEK, has adopted House Joint Resolution 11-16-3S to stop the Civil Service Pension Plan from increasing government and semi-government employee contributions to 7% from 6%.
The Civil Service Pension Plan Board of Trustees had issued a notice to all employees and members of the Civil Service Pension Plan or CSPP that it would increase the employee and employer contributions effective Oct. 1, 2021.
According to the OEK joint resolution, CSPP’s decision was based on several actuarial studies that aim to prevent the plan’s complete insolvency.
But the OEK said it has been informed by the minister of finance and the director of the Bureau of Budget and Planning that they are working with CSPP to “develop comprehensive legislation that will substantially reform the pension plan and secure its financial longevity.”
The OEK resolution stated that any changes to the contribution rate should be deferred until the “comprehensive pension plan legislation” is introduced.
A local retiree, Isaac Bai, earlier urged Sen. Rukebai Inabo to oppose the proposed increase.
Others said an increase in pension contributions would further depress their salaries that are already below the basic living wage rate.
Under the Administrative Procedure Act, the OEK can adopt a resolution to void any rule or regulation adopted by an agency, provided that the OEK does so within 120 days of the adoption of the rule.