The Samoa National Provident Fund (S.N.P.F.) has elucidated reasons why the board decided the 8.3 per cent dividend will not be paid in cash this month following an uproar from the contributors.

In a press conference on Friday led by the Chairman of the S.N.P.F board, Papalii Pania Tavita, Minister of Finance, Mulipola Anarosa Molioo, and the newly appointed S.N.P.F Chief Executive Officer (C.E.O.), Lemalu Selesitina Reti, Papalii emphasised that cash payouts are not compulsory under the law.

"Nothing in the law says that cash payout is compulsory under the regulations which are made by the steering committee and the Cabinet," he said.

"Cash payouts are regulated on emergencies that need the assistance of the S.N.P.F. for example, during cyclones. The board can consider giving our cash payouts from your contributions and same as the Covid-19 and the 50th Independence Anniversary."

Papalii added that the 8.5 per cent dividend that was declared in the 2022-2023 financial year was changed to a cash payout because the board considered the struggles of the families due to Covid-19.

Mulipola initially clarified in response to a question raised from the media, querying why the dividend is not being paid in cash as in most recent dividends.

"We're used to that mentality where once you get the money, you use it and finish it right away. But we go by the name of our organisation that is 'O le lumanai manuia o Samoa' (The bright future of Samoa)," she said.

"We're trying to get used to saving money for bad days."

The Minister and Board Chair officially announced in Friday's conference that a total of 8.3 per cent totaling to $73,967,335.00 will be allocated for payment to contributors as of 1 July 2023.

This is pursuant to Section 36 of the S.N.P.F. Act for the fiscal year 2022/2023 and this means there will be no cash payments for all SNPF contributors and members as the dividend will go straight into the contributions of all S.N.P.F members.

Of the 8.3. per cent, two per cent has been paid out to all the members and contributors of the Fund in January this year. However, contributors will have a 6.3  per cent dividend injected into their accounts and members can loan from this money. 

This was explained by the Minister who also highlighted that contributors can be able to access these funds through S.N.P.F small loans.

Papalii also explained that only active members of S.N.P.F can access these funds through their small loans as non-active members who are penalised for a year will remain restricted from making small loans.

"In anything there are always laws to govern things and because of the steering committee and the Cabinet's consideration of the excessive spending of money, they decided to make a policy that once you don't pay your loans for six months or one year, the board will approve to offset you from your contributions," he explained.

"And the punishment is, within one year, you cannot loan anymore because if we allow you again to loan, we will result back to the right-off."

After the Samoa Observer broke the story hours before the press conference on Friday, contributors and members of the public questioned why the dividend will be disbursed straight into their contributions instead of cash payout as is mostly the case.