Dominguez to SSS: Use technology to reduce costs

MANILA, Philippines — State-run Social Security System (SSS) needs to reduce its overhead expenses by utilizing digital tools to improve the delivery of services to its members, a top official of the Social Security Commission (SSC) said over the weekend.

In a statement, new SSC chairman and Finance Secretary Carlos Dominguez said the state fund needs to be more prudent in managing its expenses as the fund comes from the savings of Filipino workers.

As such, Dominguez said the SSS should digitize its systems in order to reduce operational costs.  

“The new SSS law has provided the means to beef up the pension fund through contribution rate adjustments. Our role now is to digitize processes that will make it easier for members to access services. Modernizing systems will also eventually save on costs and other operating expenses,” he said.

Based on the Social Security Act of 2018, the SSS is allowed to spend no more than 12 percent of total yearly contributions, plus three percent of other revenues for administrative and operational expenses, such as salaries and wages, supplies and materials, and the maintenance of offices of the SSS.

SSS financial statements show the pension fund utilizes an average of five percent of its total revenue for annual operating expenses since 2016. Operating expenses amounted to P9.48 billion in 2016, P9.54 billion in 2017, and P9.76 billion in 2018.

As part of his mandate, Dominguez said the SSS should invest in information technology to support the planned digitization of the pension fund.

“We have to do some serious investments in technology because it will not only save us money, but will also save time for the transacting public. Online transactions are easier and more convenient. But I directed the SSS management at the same time to be clear as to when exactly we are supposed to see the returns of our investments in electronic services,” Dominguez said.       – Mary Grace Padin

At present, the SSS provides electronic services, including the online application for the issuance of social security numbers, application for member data amendment, Payment Reference Number (PRN) inquiry and generation, employment report submission, submission of contributions and loan collection list, salary loan application, certification of salary application, and filing of maternity and sickness notification, among others.

These services can be availed through the SSS website, the SSS mobile application, self-service information terminal (SSIT), interactive voice response system (IVRS) and Text-SSS.

Last year, the SSS also implemented the Real-Time Processing of Contributions Program wherein contribution payments are posted immediately, thereby avoiding delays in the processing of benefits because of unposted contributions.

“What you put in SSS as savings today is what you will receive in benefits in the future. The increase in contributions is an opportunity for members to save more for contingencies, and particularly for retirement,” Dominguez said.

In 2018, SSS’ contribution collection amounted to P181.92 billion in 2018, up by 13.89 percent from the P159.72 billion recorded in 2017.  

Meanwhile, the state fund also released P180.08 billion in benefit payments last year, higher than the previous year’s level of P170.68 billion.

Total resources also reached P507.32 billion as of end-2018, P2.45 billion higher than P504.87 billion in 2017.