Social Security Commission (SSC) Chairman Amado D. Valdez retracted the earlier statement that the contribution hike would be effective January next year.
This was after SSS President and Chief Executive Officer Emmanuel Dooc stated that the Social Security System (SSS) is planning to increase members’ contributions by 2018.
According to Valdez, they are still in the process of studying the impact of the proposal. The contribution hike shall be the last resort among measures to be taken to extend the actuarial life of the state pension fund.
“The contribution increase is our last option. However, should the institution be pushed to do such action, to secure the fund life of the SSS and for the benefit of our current and future members and pensioners, we would like to assure the public that the contribution rate increase will be at the minimum amount only,” he said.
He added that the state fund is currently exploring other options to generate income, such as disposal of sub-optimal properties to maximize revenues from real estate properties. Furthermore, Valdez said that they are eyeing investments in public-private partnership (PPP) projects to support Duterte administration’s massive infrastructure projects.
Social Security Commission Chairman Amado Valdez refuted the earlier statement that the increase contribution will be set January next year.
The hike on SSS contribution rate was tackled during the ongoing Senate hearings on the SS Reform Act of 2017.
Senator Richard Gordon authored the SS Charter Amendment which will be a landmark bill and which he will push for passage by the end of this year.
“We strongly support Sen. Gordon’s mantra that we should work, save, and invest to prosper. Right now, SSS is the best and affordable savings mechanism for our workers,” Valdez said.
One example based on the latest pension simulation by the SSS Actuarial and Risk Management Group, a member who makes Php30,000 at the time of his/her retirement with 45 credited years of service will only have a basic monthly pension of Php15,700 due to the current ceiling of monthly salary credit to Php16,000.
Meanwhile, if the MSC ceiling becomes adjusted by 2022 to Php30,000, the estimated pension will be Php29,300.
The proposed bill to amend the 2 decade old SS Charter is presently being deliberated at the committee level in the Senate as a priority bill of the Legislative- Executive Development Advisory Council (LEDAC) Executive Committee.