SSS pension rules cut off members
Workers lacking monthly payments excluded
The Social Security System, breaking a long tradition as pension provider to workers, has announced new policies that cut off members who failed to meet the required 120 monthly contributions, or the equivalent of 10 years, when they reached age 65, officials said.
SSS President and Chief Executive Officer Emilio de Quiros said workers who were 65 years old on April 1, 2013 but lacked the required 120 monthly contributions will no longer qualify for retirement pension.
“Under the Social Security Law, members aged 60 and above must have at least 120 months of contributions to qualify for retirement pension. Those with less than 120 will be entitled to a lump sum retirement benefit equal to the total amount of paid SSS contributions plus interest,” De Quiros said in a statement.
Lump sum retirement benefit means a refund of the contributions that a member has paid to the SSS.
Many members reacted strongly at the late announcement of the new policy and the manner that they were cut off, including those who tried to beat the deadline, but they have to contend with numerous requirements.
De Quiros said members who reached 65 last April 1 but lacked the required 120 contributions must file an application to continue to pay as voluntary member on or before July 1.
“Members affected by the new policy must file an application for voluntary payment of contributions for members aged 65 or over within the prescribed period so they can complete their 120 contributions and be eligible for retirement pensions,” De Quiros said.
“Otherwise, they can only receive a lump sum benefit instead of a lifetime SSS pension,” he said.
De Quiros said those who applied for voluntary payment must have been covered by SSS at age 55 or earlier with at least 80 monthly contributions by age 65, and they must file their application within the month following their 65th birthday.
“With these new rules, members facing technical retirement can continue to pay contributions to be eligible for pension benefits. At the same time, this allows SSS to keep the fund viable by ensuring that retirement pensions are funded by the requisite contributions,” De Quiros said.
In the past several months, the SSS has been actively recruiting so-called informal sector workers such as tricycle and jeepney drivers, sidewalk and market vendors and the only requirement provided by law was they should be below 60 years.
“We never heard them say: Hindi ka pwede sapagkat 59 years old ka na,” a tricycle driver said.
The new policy breaks a tradition of service and concern for workers in their old age. For many years, workers who reached age 65 but fell short of 120 contributions were allowed to continue paying as voluntary members until they filled the gap.
Under the law, employers pay about 60 percent of employees’ contributions, which range from P104 to P1,560 depending on the monthly salary. Monthly pension range from a low of about P1,000 to a high of P21,000, depending on amount and number of contributions.
De Quiros --- who announced the new policy in a statement released on June 6, or more than one month after it took effect on April 1 --- did not explain the reason for disqualification of members who lacked 120 contributions when they turned 65.
But officials, who asked not to be named because they lacked authority to speak for the pension fund, quoted him as saying: “Para hindi malugi ang SSS.”
At the House of Representatives, legislators reacted in anger when sought to comment on the issue and at least two members --- Eastern Samar Rep. Ben Evardone and Gabriela Rep. Luz Ilagan --- said they will file a resolution in the 16th Congress to look into the SSS controversy.
“Congress should look into it,” Evardone said.
“It will be violative of the mandate of SSS and the rights of the members. Why is SSS going bankrupt? What had it been doing with the members’ contributions? Has it played with the money by investing it in stocks or in questionable business activities? Did they get the permission of the members?” Ilagan said.
She said SSS management could not create a new policy without proper consultation with stakeholders.
“It is money hard-earned and saved for a rainy day or old age. The SSS has no right to arbitrarily decide to deprive the members of their pensions,” Ilagan said.
Maguindano Rep. Simeon Datumanong, who is a former justice secretary, said the harsh attitude of SSS management was illegal and in violation of the Social Security law.
“Going bankrupt is a matter of inefficiency in management, which ought to be looked into,” Datumanong said.
Citizens Battle Against Corruption Rep. Sherwin Tugna said: “The non-giving of pensions to SSS members at their advanced and retirement years when their pension is their only means of subsistence is the height of injustice.”
He said the SSS should find ways to address problems of bankruptcy like obtaining a loan or selling assets “but it should not be at the expense of pensioners.”
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