This is in reply to the items raised by Mr. Tony Lopez in his column titled, Grant the P2k pension hike that appeared in the January 06, 2017 issue of Manila Standard. We would like to correct Mr. Lopez in his belief that SSS can grow its revenues on members’ contribution alone.
SSS benefits are paid at a cost higher than what was contributed by a member, at a return of P16 for every peso paid at present. This means the surplus of contributions will narrow considerably the moment the money that needs to be generated for benefit payouts becomes greater than the contributions coming in.
It is also important to note that SSS coverage is only mandatory for workers employed in the private sector. Hence, regular inflow of contributions is only expected among the employed and productive Self-Employed segments of SSS total membership.
We disagree with the assumption of Mr. Lopez that managing funds is like “a picnic or a walk in the park.” As public officials, SSS fund managers are expected to perform to their full potential, provide value for money in the provision of services, and instill public trust and Confidence in the government. The exercise of these qualities has brought SSS to see remarkable growth in its assets base, which now stands at P474 billion, almost double the total assets of P298 billion in 2010.
Mr. Lopez also failed to account the fact that SSS has other expenses for other benefits and loans which would invalidate the computation he showed in his column. A more reliable basis to discuss the impact of the proposed additional benefit are the actuarial studies of SSS that already considered new entrants, projected trends in the labor force and investment conditions.
SSS has a fiduciary obligation to its members of ensuring the viability and soundness of their social security system. As expressly required under the Social Security law, the actuarial soundness of SSS reserve fund must be guaranteed first to be able to increase benefits. The sovereign guarantee of government subsidy is SSS’ last resort only when all other means failed.
Lastly, it seems that Mr. Lopez has forgotten that he is an SSS member. Should he wish to know the details of his records, he is welcome to visit our office.
Marissu G. Bugante
Public Affairs and Special
Events Division
Social Security System