Senator Richard Gordon on Thursday called on the Social Security System to submit to the Senate proposals on how to suspend the implementation of the 2021 contribution increase without shortening the fund’s life.
“While there is a need and the law mandates an increase in SSS contributions in 2021, we see that this is untimely, especially at a time when businesses are down,” Gordon said in a statement.
“When RA 11199 was enacted, our lawmakers did not have an inkling that a pandemic would occur and greatly affect our economy,” said Gordon, chairman of the Senate Committee on Government Corporations and Public Enterprises.
He noted that data from the National Economic and Development Authority show that SSS’s sales losses reached PHP5.2 trillion in the first half of the year alone.
“It’s only halfway through the year and this is already higher than the 2021 budget of PHP4.5 trillion. We need to balance the interest of the people who are greatly affected by the pandemic, as well and the interest to protect the funds of the SSS),” Gordon said.
But he acknowledged the difficulty of stopping the 2021 contribution increase, saying a new law may be needed as the increase was specifically mandated in RA 11199 or the Social Security Act of 2018, which also had no provision that empowered the SSS to stop it.
“We will discuss this at the committee and if necessary, we will craft a new law to make it easy for the people to get through the pandemic while continuing to pay their SSS contributions,” Gordon said.
RA 1199 was enacted on Feb. 7, 2019 to protect the fund life of the SSS, which was shortened by 10 years from 2042 to 2032 due to the approved PHP1,000 additional benefit for qualified SSS retirees, survivors and permanently disabled pensioners, which was given by President Rodrigo Duterte under a memorandum from the Executive Secretary dated Feb. 22, 2017.