5 Jun 2007

Northern Marianas retirement fund board considers legal action over law

6:25 pm on 5 June 2007

The Northern Marianas Retirement Fund board is considering launching a legal challenge to the recent enactment of a law prohibiting the agency from implementing a proportionate pension scheme.

The trustees say the new law will allow the already debt-ridden central government to insist on full pension payments despite the administration's failure to provide the Fund with the necessary money.

The Chair of the Fund's trustees, Juan Guerrero, has told the Saipan Tribune newspaper the board already has a pending lawsuit against the government over the nonpayment of debts amounting to over 120 million US dollars.

Mr Guerrero says if nothing is done, the retirement fund system will survive for only another 15 years.

He says Fund assets - now totaling 477 million US dollars - would be wiped out in a few years if the government continues to ignore its obligations to the Fund.