Samoa Government Says Relief Funds Must Be Protected

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Funds will go to vendors with rebuilding materials, not homeowners

By Alan Ah Mu

APIA, Samoa (Talamua, Feb. 28, 2013) – Victims of Cyclone Evan in Samoa must sweat for the help given them.

"It says so in the Bible," Minister of Finance, Faumuina Tiatia Liuga told reporters this morning.

Faumuina referred to the Bible in that you eat from the sweat of your brow.

"That is why God gave us hands and legs," he said.

That was Faumuina’s response to a call by the Opposition for Government to re-build houses destroyed by the cyclone for free.

The occasion was his signing over today of 24 million tala [US$10.2 million] for cyclone victims.

Of that 5 million tala [US$2.1 million] goes to Samoa Housing Corporation (SHC) to lend out to families who lost homes in the disaster.

Chief Executive Officer of SHC, Mata’utia Rula Levi, if a claimant has no one in the immediate family who is employed, SHC will consider "someone with ability to pay" in the extended family.

"Funds to be lent out have to be protected," Mata’utia said.

She expects all loan applications from most of those eligible to be handed in by June.

The Development Bank of Samoa received the rest of the relief funds released today of 19 million tala [US$8 million].

Those funds are to be lent to businesses who suffered losses in the cyclone.

Victims eligible to claim assistance from the relief funds from both Housing and Development Bank are to be taken from a list compiled by DMO (Disaster Management Office), Minister of Finance, Faumuina said.

"But it’s (eligibility) not limited to that," he said. "Because there are people who are not on the list who do not know there is a list."

Inspections will be carried out to confirm those who are in genuine need.

Faumuina said funds won’t be given directly to cyclone victims but to the companies where building materials are bought from.

Claimants pay interest of 3 percent at either Development Bank or Housing.

"This 3 percent, it covers administrative costs," the minister said.

To take Housing as an example, how it works is that the corporation borrows the 5 million tala from Central Bank.

For that Central Bank charges Housing interest of 1 percent to pay for administrative costs.

Housing then lends those funds to cyclone victims at 2 percent interest to pay for administrative costs also – plus the 1 per cent that went to Central Bank.

From those accumulated administrative costs cyclone victims thus each pay 3 percent in interest.

Faumuina said there is an interest-free period of 12 months on loans.

None of the state bodies involved, Central Bank, Development Bank and Housing, makes a profit in the transactions ahead, he said.

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