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Bush asked to fund Prior Service pensions
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Posted on May 09 2008
Regional leaders are asking the U.S. government to fund a pension program for Micronesians who worked for the Trust Territory government before 1968.
The Micronesian chief executives in their recent summit in Palau wrote separate letters to President George W. Bush and Interior Secretary T.H. Dirk Kempthorne urging the officials to pay the federal government’s “debt” to the Prior Service program.
A one-time appropriation of $13 million is needed to continue the program for the next 40 years. On an annual basis, the program needs about $850,000, exclusive of cost of living allowance, for the next five years, and a descending annual amount thereafter.
Without the funding, the program’s beneficiaries will lose benefit allowances, which average about $40 a month.
“These amount appear insignificant in today’s economic environment but for many of these individuals living in remote island locations, the monies provide for some basic food staples,” the leaders told Kempthorne.
The Prior Service Program was established in 1968 to provide retirement, disability and survivor benefits to Micronesians, who were employed by the U.S. Department of Navy and the former Trust Territory of the Pacific Islands government from 1944 to 1968.
The program was funded by the U.S. government as part of the Department of the Interior appropriations earmarked for the operation of the TTPI government. The funding stopped when the Compacts of Free Association went into effect in 1986. The U.S.-CNMI Covenant was fully implemented in the same year.
The U.S. Congress then appropriated $8 million to establish a trust fund to provide for benefit payments for the Prior Service program. At that time, it was noted that there might be need for additional funding, as not all of the eligible beneficiaries had been certified.
The certification process was slow and tedious because all of supporting documents were maintained in paper files and, in many cases, multiple sources had to be checked to confirm that the person was eligible.
The Prior Service beneficiaries, some of whom served as marine scouts with the U.S. military during the War in the Pacific, worked for very low wages without any benefits.
