State-run pension fund Social Security System said the enactment of Republic Act No. 11199, or the Social Security Act of 2018, will add 13 more years to its fund life or until 2045.
SSS president and chief executive Emmanuel Dooc said Thursday fund life’s extension would be driven by the implementation of the contribution increase and the adjustment in minimum and maximum salary credits under the newly-signed law.
RA 11199 aims to strengthen the pension fund through the implementation of the gradual increase on monthly contributions from the current 11 percent to an addition of 1 percentage point starting in the year of implementation until it reaches 15 percent by 2025 and the gradual adjustment of the minimum and maximum monthly salary credit.
SSS said that based on an actuarial and risk management group’s study, there would be an additional P31 billion in contribution collections of the pension fund in 2019 if the 12-percent contribution rate with adjustments in the minimum and maximum MSC would be implemented.
SSS’ fund life in 2016 was 26 years or until 2042. This was reduced by 10 years when the P1,000 additional benefit for pensioners was implemented in 2017. SSS shelled out an extra P33.26 billion in 2017 for the implementation of the P1,000 additional benefit for more than 2.3 million qualified pensioners.
“We would like to appeal to our members to see these reforms as additional savings and not as a burden for them. We would like to ensure that the SSS would have enough funds for their short-term and immediate financial needs during times of contingencies,” Dooc said.
“Along with these reforms, of course, benefits and privileges for our members will also improve. One example, assuming a member who has a monthly salary of P20,000, and has paid 12 contributions in the 12-month period before the semester of contingency, his/her sickness benefit will increase to P600 per day from the current P480 per day,” Dooc said.
For the same monthly salary of P20,000, maternity benefit is also expected to increase to P40,000 for non-cesarean from the current P32,000. The average basic monthly pension is also expected to increase to P8,000 from the current average of P6,400.
“This law also provides unemployment insurance for those who will be involuntarily displaced from employment. Under the law, displaced workers will get financial assistance from SSS in the form of cash equivalent to half of their average monthly salary credit for two months,” Dooc said.
SSS members are currently covered with sickness, maternity, disability, retirement, funeral and death/survivor benefits.
The law also provides protection for the growing number of Filipinos working abroad as it made social security coverage of overseas Filipino workers mandatory.
“Filipinos who work outside the country are more prone to risks as they are exposed to the unfamiliar environment while they are trying to earn for their family. Our goal here is to ensure that all of OFWs will be protected under the SSS,” Dooc said.