SSS eyes hike in members’ contribution
State-run pension fund Social Security System (SSS) said Monday that it could further extend its fund life if it implemented more structural reforms, including another increase in the contribution rate.
It is also looking at raising the statutory cap for SSS contributions.
Citing its latest actuarial valuation, SSS noted that its fund life was extended by four years to 2043 from 2039 previously when the higher contribution rate as well as monthly salary credit ceiling were implemented in January last year.
However, since SSS pensions were increased by 5 percent last year, the fund life was rolled back by a year, now projected to last in 2042.
“What has to be done immediately are structural reforms. Our investments have been performing remarkably well despite the low interest rate environment, but we can only invest and earn so much. If the contribution rate remains unchanged while benefit payments continue to swell, the SSS’ reserve fund will be exhausted by 2042,” according to SSS chief actuary George Ongkeko Jr.
Separately, SSS president and chief executive Emilio S. de Quiros disclosed that the pension fund was planning to deploy a portion of its investment reserve funds overseas, but pointed out that the domestic market remained their priority.
“We are evaluating all available investments options allowed by the SSS charter that can generate the highest yielding returns on our investments. At the moment, we are strengthening our position in the local market. While investing abroad is an option, it is still under study,” he said.
As of April, the SSS has P428.2 billion in investment reserve funds, which are distributed in government securities (P155.3 billion), equities (P103.9 billion), member loans (P76.8 billion), bank deposits (P44.6 billion), corporate notes and bonds (P29 billion) and real estate (P18.6 billion).
Subscribe to INQUIRER PLUS to get access to The Philippine Daily Inquirer & other 70+ titles, share up to 5 gadgets, listen to the news, download as early as 4am & share articles on social media. Call 896 6000.