MANILA, Philippines - The Social Security System (SSS) is likely to implement within this year its planned increase in members’ contributions to 11 percent.
“It will be from 10.4 percent to 11 percent by the end of the year,” SSS president and chief executive officer Emilio de Quiros said in an interview.
Employers are amenable to the plan, based on consultations with various company executives, De Quiros said.
He said the state-owned pension fund for private employees is now in the process of seeking the necessary approval from the Department of Finance and the Office of the President.
De Quiros said the Finance department, which oversees the operations of government-owned and controlled corporations (GOCCs) as well as pension funds such as SSS and the Government Service Insurance System (GSIS), is supportive of the plan.
The SSS wants members’ contributions raised by 15 percent in the long term to make them at par with those in other countries.
De Quiros said that after the 11 percent adjustment this year, the SSS would work on a regular increase in contributions once every two years by at least one percentage point, until it reaches the desired 15 percent rate.
With the increase in the contribution rate, SSS expects to increase the actuarial life of its fund from the current 28 years up to 2039, to 2046.
De Quiros said the goal in the medium term is to extend the actuarial life of the fund to 70 years.
The higher contribution rate would be split between the employer and the employees.
De Quiros said the increase is minimal and is intended to ensure more benefits for members. The last time the SSS raised its contribution rate was in January 2007.
Aside from raising the contribution rate, De Quiros said SSS also plans to increase the amount of the maximum monthly salary credit (MSC) to more than the prevailing ceiling of P15,000.
At present, the minimum and maximum MSC brackets are P1,000 and P15,000, respectively. A monthly pension is applicable to SSS members who have contributed at least 120 months.
SSS retirees also receive 13th month pension as well as dependents’ pension for each of the first five minor children conceived prior to retirement. Those who are of retirement age but not qualified for pension benefits are given a lump-sum amount equal to total contributions paid plus interest earned.
Members are also entitled to disability benefits. A monthly pension is provided in the case of permanent total disability for members who have at least 36 monthly contributions.
Death benefits, meanwhile, are given to beneficiaries of deceased SSS members with at least 36 monthly contributions. His or her primary beneficiaries are entitled to monthly pension, including the 13th month. Other SSS benefits include sickness and maternity benefits.