MANILA, Philippines - Still reeling from the impact of the recent wage hike, various business groups yesterday rejected proposals to increase Social Security System (SSS) contributions.
The Employers Confederation of the Philippines (ECOP), in a statement, said an increase in SSS premiums would lead to a drastic increase in labor cost.
“Given the volatile economic situation, the capacity of employers and employees to absorb the increases, and its overall impact on the economy and viability of businesses... It radically increases indirect labor costs,” ECOP president Edgardo Lacson said.
Lacson belied the pronouncement of SSS officials that employers are amenable to the planned 11 percent increase in members’ contributions.
Although consultations with various companies were conducted by SSS, he said ECOP was not among those groups.
The SSS is planning to adjust members’ contribution from 10.4 percent to 11 percent by the end of the year and to 15 percent in the long term to make them at par with those in other countries.
But Lacson said various business groups have long expressed strong reservations over any increase in SSS premiums.
“We objectively wrote a letter to them (SSS) opposing any adjustment in premium contributions at the cost of employers and workers,” he said.
Aside from ECOP, other groups that are against the planned increase include the Philippine Chamber of Commerce and Industry (PCCI), Philippine Exporters Confederation, Inc. (Philexport), Philippine Food Processors and Exporters Organizations, People Management Association of the Philippines (PMAP), Federation of Filipino-Chinese Chambers of Commerce and Industry, Inc. (FFCCCII), Makati Business Club (MBC), Philippine Constructors Association (PCA), Business Processing Association of the Philippines (BPAP), Philippine Association of Colleges and Universities (PACU), Philippine Association of Local Service Contractors (PALSCON), Philippine Franchise Association (PFA), Philippine Retailers Association (PRA), Semiconductor Electronics Industries in the Philippines (SEIPI), Philippine Plastics Industry Association (PPIA).
The business groups insisted that adjustments in SSS contributions would greatly hurt both employers and workers.
PCCI president and ECOP chairman Miguel Varela said with the recent P30 cost-of-living allowance (COLA) approved in the National Capital Region (NCR) wage board, increasing contributions at this time would be a “double whammy” for business.
“There is no basis and immediate necessity for the increase,” Valera said, noting that the SSS Fund can continue operating without increasing the premiums being paid by both employer and employee.
Varela said the SSS may be able to strengthen its viability through other means such as prudent spending, maximizing yield on investments or increasing the number of new members, especially voluntary contributions.
“Let us think of other ways to enhance the benefits for members. Let us not pass the burden on to the employers and the employees,” he stressed.
Philexport president Sergio Ortiz-Luis Jr. expressed fear that the increase in SSS premium would encourage other institutions like Pag-IBIG and PhilHealth to do the same.
“Agreeing to the plan of SSS might send the wrong signal to these other agencies that employers are willing and capable to absorb the increases in contribution, which is not the case,” he said.
Based on year 2007 estimates from the SSS, Ortiz-Luis said the life of the Reserve Fund is expected to last until 2039.
“If the goal is to gradually increase the life span of the fund, it can be done without increasing the premiums being paid by both the employer and employee,” he argued.
Oldest pensioner is dead
Meanwhile, the SSS reported that its oldest pensioner who reached the age of 101 is dead.
Bella Bermudo, head of the membership relations office, said the pensioner who was the first to exceed the 100-year-old mark was reported to have died of natural causes. He was receiving a monthly pension of P3,000.
The name of the pensioner and other details were not immediately available but Bermudo said he was an ordinary worker when he retired 39 years ago.
She said oldest pensioners now are below 100 years old and an annual head count is being conducted to insure that only those still living are receiving their monthly pension.
Bermudo said the average monthly pensions range from P1,500 to P15,000 depending on the monthly contributions of members.
More than 800,000 retirees all over the country are receiving their monthly pension from SSS. – With Perseus Echeminada