THE Social Security System on Tuesday maintained its support for a P2,000 pension increase, but called on the Senate to consider the implementation of an initial P1,000 hike.
“The Social Security System is attuned to the wishes of legislators for higher pensions in response to the prevailing public sentiment, which we also consider reasonable given the current cost of living. We request legislators to heed our appeal to how to best grant the pension increase without sacrificing the life of the fund,” SSS chairman Amado Valdez said.
Under the proposal of SSS, the grant of the P1,000 across-the-board pension increase shall be in January 2017, and an additional P1,000 in 2022, or earlier.
“Immediately implementing the full P2,000 pension increase will put in peril the SSS funds. The P1,000 initial pension increase offers a more doable option towards the same goal of an additional P2,000 per month for pensioners,” Valdez said.
According to SSS, its funds are currently projected to last until 2042 but will deplete in 2025 if the P2,000 increase is immediately granted in full.
If the P2,000 hike is implemented in 2017, SSS would need an additional P64 billion for pensions for that year alone, and this amount is expected to grow every year.
With the P1,000 initial increase, the SSS funds life will last until 2032.
In a statement, SSS said it continuously explores innovations which include investing in corporations engaged in power, water and other utilities, and pursuing Public-Private Partnerships in developing infrastructure such as toll roads, which would provide stable long-term earnings for the funds of SSS members.
Valdez said while government subsidy remains a possible source for financing the P2,000 increase for at least two million pensioners, it should only serve to supplement, and not fully shoulder, the funds needed for the increase.
He said the release of the P2,000 pension increase in two tranches would be win-win solution since it allows the institution to increase the benefits of its pensioners without crippling the ability of SSS to maintain its long-term financial viability and continue fulfilling its benefit obligations to all members.
“The new SSS management will do its best to explore better options and creative solutions to shore up SSS revenues from improved contribution collections and investments, and enhancing operational efficiency so that we can afford to increase our members’ pensions and other benefits,” he added.