SSS criticized over excessive loans, delinquencies
Pension fund ‘extending loans in excess of reserve limit’
More News from Philippine Daily Inquirer
The Commission on Audit has called the attention of the Social Security System to the excessive amount of loans it extended as well as its significant delinquency rate.
The COA likewise took the SSS to task over its failure to post over P3 billion worth of loan payments made by members.
In its updated audit report on the 2011 financial statement of the SSS, the COA said the state-owned pension fund failed to observe the limit on loans it could grant to members.
Under the SSS charter, outstanding loans to members should not exceed 10 percent of its reserve fund.
The COA said the SSS had P43.23 billion in outstanding loans as of the end of last year. That amount was P11.9 billion higher than the supposed ceiling.
“Member loans of P43.23 billion (net) exceeded the 10-percent limit of the investment reserve fund by 38.05 percent, or P11.915 billion,” COA said.
The commission also found that about 87 percent of SSS’ receivables were delinquent. The COA said the heavy exposure of the SSS to delinquent accounts is causing lost potential income from viable investments that the pension fund manager could have engaged in.
“[The SSS should] take a comprehensive approach in addressing the problem on delinquent accounts to limit member loans at reasonable levels,” the COA said in its report.
The audit agency also said the SSS should address the problem of unposted regular loan payments by members, valued at P3.47 billion.
The amount represents bulk of unregistered loan payments made to the SSS. The COA also said that there was P921 million worth of unposted real-estate loan payments.
In response to the COA report, the SSS admitted that its outstanding loans are higher than the ceiling but explained that it has already implemented measures to address the issue.
SSS President Emilio de Quiros Jr. said outstanding loans to members have been in excess of the limit for years, even prior to his assumption to office in 2010. He said that over the past two years, the SSS has been implementing programs that condone penalties for delinquent loans with the aim of reducing the outstanding loans and the delinquency rate.
“We have already brought [the proportion of excess loans] down. We have initiated condonation programs and generated loan payments from those initiatives,” De Quiros said.
Get Inquirer updates while on the go, add us on these apps:
Disclaimer: The comments uploaded on this site do not necessarily represent or reflect the views of management and owner of INQUIRER.net. We reserve the right to exclude comments that we deem to be inconsistent with our editorial standards.
To subscribe to the Philippine Daily Inquirer newspaper in the Philippines, call +63 2 896-6000 for Metro Manila and Metro Cebu or email your subscription request here.
Factual errors? Contact the Philippine Daily Inquirer's day desk. Believe this article violates journalistic ethics? Contact the Inquirer's Reader's Advocate. Or write The Readers' Advocate:
c/o Philippine Daily Inquirer Chino Roces Avenue corner Yague and Mascardo Streets, Makati City,Metro Manila, Philippines Or fax nos. +63 2 8974793 to 94