SSS contribution hike may not push through in April

MANILA, Philippines — The proposed increase in the contribution of Social Security System (SSS) members may be delayed until the second half of the year, the state pension fund said yesterday.

In a press briefing, SSS president and CEO Emmanuel Dooc said the planned contribution hike may not proceed next month as originally scheduled.

However, the SSS chief said the agency remains hopeful the proposal would be approved and implemented within the year.

“I hoped it could be started by April, but that will not happen...I hope that we can still do it in the second half (of the year). First half, there’s a slim chance. Hopefully, by June,” Dooc told reporters.

Earlier, the SSS said it has submitted a proposal to the Office of the President pushing for the increase in the contribution rate as well as the minimum and maximum salary credit of its members.

Under the original proposal, the SSS wants to adjust the contribution rate by three percentage points to 14 percent of members’ monthly salary credit from the current 11 percent.

This would continue in tranches of 1.5 percentage points each year until the total rate reaches 17 percent by 2020.

The SSS also seeks to adjust the minimum salary credit to P4,000 from the current P1,000 and the maximum salary credit to P20,000 from P16,000.

Dooc said the adjustments, if implemented in April, would have translated to P45 billion in additional revenues for the SSS.

However, he said the incremental collections would be lower than this estimated figure since there will be delays in the implementation.

Furthermore, the SSS chief said the Department of Finance and the OP are still studying what configurations in the contribution rate and monthly salary credit increase would be made, should it be implemented.

According to the SSS, the move to increase member’s contribution is seen to protect the viability of the pension fund following the P1,000 increase in the pension benefits of retirees.

Based on the SSS’ actuarial studies last year, the pension hike cut the actuarial life of the fund by 10 years to 2032. If the SSS implements the premium increase, Dooc said the fund life would reach up to 2045.

The SSS said this would also translate to higher benefits that are at par with those received by the members of the Government Service Insurance System.