SSS plans actuarial study on second pension hike

MANILA, Philippines — The Social Security System (SSS) is planning to conduct an actuarial study next year to determine if it would be able to implement the second tranche of pension hike following the enactment of its new charter, a top official said.

In an interview with reporters, former Social Security chairman Aurora Ignacio said the SSS is set to carry out an actuarial study next year, after the implementation of Republic Act 11199 or the Social Security Act of 2019.

Ignacio said the study would ascertain if the state pension fund would be financially sound enough by then to release the P1,000 additional benefit to its member-pensioners.

“We might have to wait until (the new contribution scheme) is implemented. Maybe next year we can do the evaluation,” Ignacio said.

“When we see that it is very sound, we might propose for (pension increase),” she said.

According to Ignacio, it is still possible for the SSS to deliver the P1,000 pension hike within the term of President Duterte.

She said the release of the additional pension would depend on the performance of the state fund, and its success in improving collections and investment income following the implementation of the Social Security Law.

“Hopefully, we will be able to properly and efficiently implement the new contribution scheme, plus with the support of the new law, we can increase the investments that we can do,” she said.

President Duterte in 2017 approved a P1,000 increase in SSS pension benefits. The second tranche, or another P1,000 increase is slated by 2022, or the end of Duterte’s term.

Based on the SSS’ actuarial studies, the pension hike cut the actuarial life of the fund by 10 years to 2032.

But with the implementation of RA 11199, the SSS said it expects its fund life to be extended until 2045.

The new law, which repealed RA 1161, as amended by RA 8282, and was aimed to strengthen the SSS by rationalizing the powers of the Social Security Commission.

It allows the policy-making body of the SSS to expand the investing capacity of the pension fund to generate better income, for the benefit of members and pensioners.

SSS said it is also expected to generate additional funding for the pension fund as it imposes additional premium contribution from members.