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Thursday, March 28, 2024

Govt salary increase to boost GSIS funds

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State-run Government Service Insurance System said it expects members’ contributions to reach P83 billion this year, following the salary increase in government.

GSIS president and general manager Robert Vergara told reporters in a media briefing he expected members’ contributions to grow by 5 percent to 6 percent in 2016, on the back of compensation adjustments for government employees.

“The salary increase this year is something that we believe will be more felt in this year’s collections, so we are expecting an increase of around five to six percent, depending on how quickly the different agencies implement the salary increases in the wage hikes,” Vergara said.

Vergara said in 2015, GSIS collected P79.8 billion in premiums from members. “So if that grows by five or six percent, because of the implementation of the salary increase phase one, I think we will probably make P82.5 billion to 83 billion,” he said.

President Benigno Aquino III signed Executive Order 201 in February this year, which granted a salary increase for government employees and additional benefits for civilian and military and uniformed personnel. 

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President Aquino issued the order, after the proposed Salary Standardization Law was not enacted by Congress due to time constraints.

The Budget Department earlier said the EO mandated compensation adjustments this year as an interim measure to implement the first tranche of the proposed SSL.

Vergara said on top of compensation adjustments, the hiring of additional teachers by the Education Department in preparation for the K to 12 program would also drive members’ contributions growth. 

“One of the steady contributors to our revenues is the contributions of our members. There were some improvements in contributions because we have an agency which is still adding to their ranks, the DepEd. As it readies itself for the K-12 implementation so our membership base grew in 2015,” Vergara said. 

“We ended the year with total membership of 1.51 million active members and we began the year with 1.46 million, a net addition of about 50,000 employees and bulk of that came from DepEd. That had the impact of slightly increasing what we received in premiums from 2014,” he said.

Vergara said an additional 50,000 to 70,000 members were expected until the time the Education Department finished hiring new teachers.

“Government payrolls were also pretty static in 2000 to 2010. It was the programs implemented by the current government that resulted in jump in payrolls,” Vergara said. 

 

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