The committee on government enterprises and privatization approved a measure granting an increase of P2,000 in the Social Security System (SSS) monthly pension of the elderly.
The House of Representatives Committee on Government Enterprises and Privatization approved the re-filed bill seeking to give a P2,000 across-the-board increase to the monthly pension of Social Security System (SSS) members.
During the first public hearing, the Committee approved the motion of Bayan Muna Partylist Rep. Carlos Zarate to consolidate into one version the 15 bills, all of which propose the P2,000 pension hike. A total of 16 bills on the pension increase were approved by the House panel chaired by North Cotabato Rep. Jesus N. Sacdalan.
The proposed amendment to Section 12 of Social Security Act of 1997 provides that the minimum monthly pension will be raised to P3,200 from P1,200 for members with at least 10 credited years of service and to P4,400 from P2,400 for those with 20 credited years of service.
However, SSS Senior Vice President and Chief Actuary George S. Ongkeko, Jr. said the increase in pension P2,000 would reduce the financing institution's fund from 2042 to 2025.
SSS has long argued that it is necessary for the government to find a “funding mechanism” to finance the proposed hike in monthly SSS pensions as this will significantly shorten the life of the fund. “We are very supportive on whatever amount, as long as there’s a sustainable funding source.” Ongkeko said.
Furthermore, SSS reported that a seven to eight percent increase in return on investments (ROI) occurred in the past years, however, an increased ROI is still not enough for the disbursement of its pension until 2042.
“If the increase will be approved [without increase in premium], then we will have to follow the law. If we ran out of actuarial life by 2015, we can call in a government guarantee from the DBM [Department of Budget and Management],” Ongkeko said.
Last January, the enrolled SSS pension hike was vetoed by former President Benigno Aquino, for its “dire financial consequences”.