President Rodrigo Duterte has approved a P1,000 increase in benefits of pensioners of Social Security System (SSS).
Presidential Spokesperson Ernesto Abella made the announcement on Tuesday during a press conference in Malacañan Palace together with SSS top officials, Chairman Amado Valdez and President & CEO Emmanuel Dooc.
“The President has approved a P1,000 pension hike this month with a corresponding 1.5 contribution rate hike in May 2017 and an increase in monthly salary credit to P20,000 from P16,000,” Abella said in a statement he read before the media.
Dooc, however, later on clarified when asked by reporters that there might be a “slight delay” in the implementation of the increase saying that it may extend until February as they have to finish all the computations for the adjustments.
Nevertheless, Abella said the adjustment was part of the President’s fulfillment of his social contract with the Filipino people, “especially the elderly and the poor who gave the best years of their lives in service.”
The Palace official said the President was not amenable to using taxpayers’ money to fund pension increase considering that the SSS is a private pension fund.
Thus, SSS has opted to increase contribution rate to cover the hike. By May 2017, a 1.5 contribution rate increase will be implemented or 12.5 percent from the current 11 percent contribution rate.
In peso value, the additional total contribution will range from P15 to P740 equally shared by employer and employee.
Valdez said the SSS is eyeing to implement another P1,000 increase by 2022 or even earlier as 2019 in order to comply with the initial proposal of P2,000 hike in pension.
Meanwhile, Valdez assured that SSS pension fund will last until 2040 despite the hike given the increase in contribution rate.
To ensure sustainability, SSS will carry out legal action plans to reduce contribution delinquency, said Valdez, which include intensifying collection from delinquent and non-compliant employers, aggressive prosecution of delinquent employers and facilitating settlements.
SSS also plans to closely coordinate with the Department of Justice, create more legal department branches, reorganize legal and enforcement groups, operationalize paralegal systems and adopt core processes.
At the same time, SSS looks at executive interventions that will improve collection through the issuances of Executive Orders.
Dooc said they also plan to require companies participating in government biddings to present SSS clearances to ensure that they pay premiums of their employees. This is part of the moves to boost SSS contribution.
Also, SSS is looking at requiring overseas Filipino workers (OFWs) to register as members prior to their deployment abroad to increase SSS capital base.
Valdez said they will review the current salary scheme to prevent unreasonable increases in SSS officials’ salaries noting however that the fund is like any other modern corporation that needs efficient and professional people to be successful.
wIf there are increases in salaries and bonuses, Valdez said those must be indexed in the officers’ performances. This is to allay public doubts that SSS is misusing the fund.