SSS: Another hike in pension to cut fund life to 2026
Implementing the second tranche of pension hike next year, as promised by President Duterte, will cut short the Social Security System’s fund life to only until 2026, the state-run pension fund’s president and chief executive Emmanuel F. Dooc said yesterday.
It means members and pensioners can still enjoy their benefits in the next seven years. After that, the SSS will no longer have funds to disburse benefits.
This was the reason why Dooc last week said the SSS wanted to delay the implementation of another P1,000 hike in monthly pension for retirees to 2020 instead of 2019.
In a statement, Dooc said the SSS’s fund life was already slashed by 10 years to 2032 from 2042 when an additional P1,000 a month were disbursed to pensioners starting last year.
To recall, President Duterte last year approved an initial P1,000 additional monthly pension benefit, with a second tranche of another P1,000 to be granted to pensioners beginning next year.
But with the higher pension benefits for retirees, the SSS’s net income in 2017 slid 37 percent to P20.3 billion.
While the SSS’s revenue last year rose 15 percent to P200.5 billion, expenditure climbed at a faster rate of 27 percent to P180.2 billion.
The jump in expenditure, which include operating expenses, came on the back of the additional P1,000 in monthly pension, which totaled P33.5 billion in 2017.
The SSS wanted to jack up members’ contribution rate to up to 14 percent within the year from the current 11 percent to compensate for the impact of the pension increase on its fund life.
However, the SSS was unable to implement the planned 1.5-percentage point contribution rate increase as initially scheduled in May last year as it awaited the passage of the Tax Reform for Acceleration and Inclusion (TRAIN) Act.
