“They talk as if this one entity, the Legislature, did all these wrong things, but we are all in this crisis situation so what are we going to do about it?” she said.
The Retirement Fund said the government owes the agency over $200 million in unpaid employer contributions, including penalties.
“The Fund must be more understanding of the overall situation of this government,” said Pangelinan, D-Saipan. “What will the Fund do with the damages it wants to collect? Use the funds for off-island trips and invest in stocks that will lose money?”
Pangelinan, who testified in court last week, said she told the judge that “if the market crashes again and the Retirement Fund loses its remaining investments, we would not be in this courtroom — we would be in the Legislature trying to raise funds.”
The chairwoman of the Senate Fiscal Affairs Committee, she submitted an affidavit to the court regarding the government’s financial condition.
But she said the Retirement Fund counsel, Viola Alepuyo, didn’t want the court to accept the affidavit as an exhibit.
Judge Kenneth L. Govendo, however, allowed Pangelinan to testify and discuss the points she made in her affidavit.
“I am not against paying the Retirement Fund,” she said. “What I’m trying to do is to figure out how to pay the Fund.”
The agency, however, has to be more transparent, she added.
“I’ve to fight to get records from them and information about the members. They told me to get it from [the Department of] Finance. Then they said their records are different from Finance. Why can’t they sit down and reconcile their records? I also looked into the Fund’s investment losses through the years and I think they got upset with that.”
Pangelinan said the point of her testimony in court is to show “the need to work out a solution so we can find the money to pay Retirement Fund without shutting down the government.”
Litigation for damages is not going to help the government or the Retirement Fund, she added.
“We’re wasting money on litigation. It’s ridiculous to have the money managers [from the states] to come here and make a presentation on the amount that the Retirement Fund could have had if the government paid its contributions when they couldn’t even guarantee that the money would not have been lost in the stock market anyway.”
Pangelinan said it is useless to dwell in the past or base one’s actions on what-ifs.
“This is the problem now and we have to solve it now. But why go through this expensive litigation and pay lawyers when it’s not the solution we’re looking for?”
Asked if politics has something to do with the litigation, the senator said, “I have no personal or political agenda. I base my actions on facts. I also believe that [Retirement Fund Chairman] Juanpan [T. Guerrero] also has no agenda and he is just trying to do what is right. But I hope he will also have consideration for the overall financial state of the government and the essential public services that the community depends on. Let’s all make sure that the pension system will survive and the retirees get their pensions without resulting in massive layoffs and cutbacks in government services.”
Pangelinan, a freshman senator, is not seeking re-election. Guerrero, a former senator, is running for governor. His running mate, House Floor Leader Joseph N. Camacho, is the husband of the Retirement Fund’s counsel, Viola Alepuyo.
“I don’t like that we are fighting and incurring a lot of expenses — lawyer fees, money manager fees, actuarial fees — when we know that the solution is to sit down and find the money and draw up a structured payment plan for the Retirement Fund,” Pangelinan said.
The Retirement Fund has sued the CNMI government over its unpaid employer contributions.
Last December, the court ruled in favor of the Retirement Fund and is now determining the amount of damages the government has to pay.
