Lolo addresses Faoa & Sanitoa allegations about Retirement Fund going broke
Gov. Lolo Matalasi Moliga publicly lashed out at the gubernatorial team of former lieutenant governor Faoa Aitofele Sunia and Rep. Larry Sanitoa regarding the ASG Employees Retirement Fund, which the governor says lost money during Faoa’s tenure — when he was a member of the Board of Trustees.
Speaking at last Saturday’s territory-wide campaign rally, the last major one for the Lolo and Lemanu campaign before the Nov. 8 general election, Lolo addressed a large crowd at Fagaalu Park, focusing on the Retirement Fund and the American Samoa Economic Development Authority issued bonds by responding to what he says are untrue and mis-guided statements and announcements by the Faoa and Sanitoa team.
The Lolo and Lemanu campaign also paid for airtime on two local radio stations, which broadcast the rally that kicked off at around 7a.m through 12noon.
First the governor told the crowd that for more than 100 years, American Samoa has gone through rough times and struggle — difficult times — and despite it all the territory has survived. But if there is a leader who claims that he can make such problems go away, Lolo says there is no truth to such statement because the problems and difficulties of yesterday will happen again today, and tomorrow.
But leaders who qualify and are honest, those are the leaders who look and lead its people and country to safety, instead of making false promises, Lolo said.
The governor then pointed out that while attending Friday’s funeral service for the late former Sen. Velega Savali, a mother asked him to give a thorough public explanation on the status of the Retirement Fund.
The mother had been a teacher for 35 years and has since retired and is now collecting about $700 a month in retirement benefits. However, Lolo says the mother told him that when political campaigning reached her home, Faoa and Sanitoa informed her that the Retirement Fund will go bankrupt in 10 years.
He said he told the retiree, to be patient, and he will give an accurate explanation at the appropriate time. The governor then spoke about the Retirement Fund to counter what he says are misleading public statements which have been made by Faoa and Sanitoa.
Lolo said the truth is that if the changes that were made by [his] administration were not made and implemented, the Fund would bankrupt within nine years instead of 10. And why, because of decisions made that were not done right in the past, he said.
The governor claimed the first mistake the Retirement Fund made was the appointment of Faoa to serve as a board of trustee member. He said people can search everywhere and there is no government in this world, that would have a governor and lieutenant governor appoint a lieutenant governor as a member of an important board. Lolo never mentioned the former governor, Togiola Tulafono, by name during his speech.
Lolo also said that Faoa, a sitting lieutenant governor at the time, served on the board of trustees for more than 10 years. And the most troubling — and very unfair — Lolo said, is that Faoa was not only a board member but was also compensated — Faoa got paid and this is the most dishonest matter in all of this.
The governor went on to claim that throughout the years the lieutenant governor was trustee member, those were the same years that the board of trustees didn’t have a voice when it came to decisions on the fund.
Why, because all decisions were changed by either the governor or lieutenant governor, Lolo alleges, and noted the law gives the authority to the board of trustees to make decisions on the Retirement Fund.
Lolo then told the crowd that if Faoa was paid $6,000 a year as a trustee and there are 12 months a year, “that’s the total” of how much went to Faoa. Lolo didn’t publicly announced the total amount Faoa received or provide an explanation on the $6,000 a year — which Samoa News should point out is the amount each board member is compensated annually.
Lolo went on to tell the crowed that the latest information and review reveals that more than $100,000 went to travel by the board of trustees, which included Faoa. (Lolo didn’t elaborate more on the information and review, not identifying the timeline for the travel expenses.)
He said these are money for the Retirement Fund that should not have been used for such purpose but was used anyway because of the wrong decisions that were made and led by Faoa. Additionally, one word from the governor or lieutenant governor and all the decisions made by the board were changed. (Again Lolo didn’t identify the governor at the time by name.)
Lolo went on to say that in the years 2003 and 2004 as well as the years thereafter the Retirement Fund was valued at more than $300 million and by the time Faoa left office it was less than $200 million. And this is the reason, he said that he argued along with the Fono to change members of the Fund’s board of trustee when his Administration took office in 2013.
Lolo also claimed that Faoa and Sanitoa are against the increase in the number of board of trustee members (which went from five to seven, although the Administration had proposed to increase from five to nine but the Fono reduced it down to seven.)
He said that in a democratic society, the more voices and input on matters, the so much better the decisions made. It is a small handful of people making decisions that has caused problems with the Fund over the years; and Lolo said Faoa is well aware this is the cause of the problems with the Fund.
Lolo also told the crowd what has been public information since late last year, and reconfirmed during a handful of Fono hearings — both the Senate and the House — since the beginning of this year that the Retirement Fund pays out $1.5 million monthly on benefits to retirees while only $800,000 comes in from contributors — employer and employee — a month and the fund pays the balance. (As previously reported by Samoa News the Fund uses income from its investments to cover the difference of $700,000 monthly.)
Lolo said the Fono and the Fund’s Board of Trustees along with the government are working on a way to address the shortfall to ensure the Fund remains healthy in the future.
The governor also responded to complaints about the ASEDA bonds, which he said helped pay off ASG’s many outstanding legal obligations to local people, businesses and the federal government.
He said the Lolo and Lemanu Administration had to deal with these issues with the list of names and amounts owed by the government to people and businesses; and at the time, the debt reached $75 million.
Additionally, what ever is said including the negative statements about the bonds is without foundation. The governor said unless the government clears major debts there is no economic future.
Lolo then took aim at Sanitoa saying that all economic development projects and other issues on the bonds were given to the faipule. Lolo questioned why Sanitoa didn’t question the Fono at the time and tell the Fono that they are making the wrong decision in approving the bonds.
Instead, Lolo said Sanitoa waited until he [Sanitoa] was running to make his decision and issue opinions and put them out in the public arena or in the newspaper.
Samoa News should point out that Sanitoa opposed the issuance of the bonds when the measure was debated in the House and has been critical of it from the start, not only during the gubernatorial campaign.
Lolo also defended the use of some of the proceeds from the bonds to fund the Territorial Bank of American Samoa, the new vessel for Manu’a and relocation of the airport fuel tanks. He said these are important projects for the well being of the community.