SSS hikes pension, but also raises members contribution
CEBU - The Social Security System (SSS) has approved an across-theboard pension increase of P2,000 that would benefit over two million pensioners - with the initial P1,000 increase effective this month and another P1,000 in 2022 or earlier.
And SSS has to implement an additional 1.5% contribution rate and lifting the maximum monthly salary credit (MSC) to P20,000 from the current P16,000 by May 2017.
President Rodrigo Duterte approved the pension hike and the increase in members' contribution.
SSS Chairman Amado Valdez thanked Duterte in granting the pension hike.
“This shows that the President truly cares for our elderly who have been waiting for the outcome of the proposed P2,000 increase. At the same time, his decision to implement the pension increase with a corresponding contribution hike and increasing the MSC limits supports the continuing reforms in SSS to consider the welfare of the greater population of over 30 million members, who look forward to their own SSS pensions at the time of their retirement,” Valdez said.
Once implemented, the combination of additional contributions and increasing the MSC ceiling would put the SSS lifespan at 2040 as of 2017.
Valdez also defended the increase in members' contribution, saying, “he (Duterte) is being responsible when he said the government should not subsidize the pension hike because SSS is a private pension fund by nature and it is unfair for taxpayers to shoulder increases in SSS benefits.”
To help fund the proposed pension hike, Valdez said SSS will also intensify its collection efforts and improve its collection efficiency by going after non-complying employers. Another strategy to improve revenues is for SSS to invest in businesses.
Valdez reiterated SSS plans to diversify assets by directly investing in up to 25% ownership in a wide range of industries, including infrastructure projects like toll roads, real estate and even lotto operations.
On the issue of operating expenses, Valdez said that SSS has cut down its operating expenses in its 2017 budget by P1 billion as it seeks measures to improve its performance and address the existing structural imbalance in funding.
He also defended the hefty salaries and bonuses of SSS officials which have been the subject of criticisms in debates around the pension hike issue.
Valdez said the compensation and performance-based bonus of SSS have been capped not only for SSS but across all government-owned and controlled corporation with the enactment of the Governance Act and Executive Order 24 in 2011.
“We will make sure that compensation is performance-based. If all the targets we have set have been accomplished, then I think it is just fair to give incentives for good performance. This is, after all, is a practice in all government offices and private corporations,” he said.