Press Release
February 25, 2018

NANCY TO SSS: SUSPEND PLAN TO INCREASE CONTRIBUTION
...says agency must give workers breather from tax hikes first

Senator Nancy Binay urged the Social Security System (SSS) to suspend its plan to increase members' monthly contribution to 14% from the existing 11%.

"Sana po itigil muna ng SSS ang plano nilang magtaas ng kontribusyon, at pag-aralan at humanap ng ibang options bago magpropose ng pagtataas ng kontribusyon," she said.

Binay said that any extra income that members received due to some exemptions from paying personal income taxes under the Tax Reform for Acceleration and Inclusion Act (TRAIN) will only be lost due to SSS' move.

"Kung ano man ang konting ginhawa dahil sa adjustment sa personal income tax, mawawala din dahil sa planong itaas ang SSS contribution. Ipakita muna ng SSS na tapat silang bigyan ng magandang serbisyo ang kanilang mga miyembro, habulin ang mga delinquent accounts, at bigyan tugon ang mga reklamo ng pensioners at sa mga nag-aapply ng loan -- then, let's talk business," the senator said.

Binay added that SSS has failed to deliver financial security to its members due to perennial misusage of the state pension fund.

"With the consequent mismanagement of the state pension fund, the SSS also has utterly lost the high ground. Tama bang ibigay ang pasanin sa mga SSS members na kung tutuusin, ang SSS mismo ang maraming mga pagkukulang? Bakit hindi nila habulin ang bilyung-bilyong pisong unremitted and uncollected premiums from delinquent employers and non-compliant companies?" she pointed out.

Binay is one of several lawmakers who filed bills in the present Congress calling for the increase in SSS pensions and other benefits.

"Unang-una, pag-aralan po ng SSS kung papaano nito palalakasin ang collection system nito, lalo na sa mga delinquent employers. At sa mga borrower, i-ensure po natin na nakakabayad sila ng loans nila on time," she noted.

"Lumabas po noong joint hearing last year ng Senate committee on government corporations at labor na may 8.3 million delinquent members ang SSS, na may utang na Php42.7 billion. Principal pa lang po iyon, at may interes na Php25.3 billion," Binay added.

Another move, the senator said, is to run after establishments and companies who "under-report" or do not report their contributions to the pension fund.

"May mga establishments at kumpanya po na para makabawas sa kontribusyon ay hindi nagrereport o di kaya ay nagrereport ng mas mababang remittance kaysa sa tama," she said.

The employer shoulders 7.37% of the present 11% contribution rate, while the employee chips in 3.63%.

Binay said there are successful social insurance models in other countries like Australia's Superannuation Guarantee Program where SSS can study and adopt.

Superannuation program requires employers to divert 3% of most workers' salaries into regulated retirement accounts supported by employers and matched by the government. Employers, in return, get tax incentives.

"The SSS needs to reform itself and kickstart sustainable programs that will translate to better benefits, higher pensions, improved quality of customer service, and motivate members to support the pension fund. These are but small steps that will bring back the people's confidence in SSS," Binay stressed.

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