SSS: “The four-tiered contribution increase will ensure the pension fund’s financial viability for the benefit of its members, pensioners, and their beneficiaries”
SSS – The Social Security System recently defended the increase in contribution of employers and members to the pension fund scheduled in 2023.
SSS president and CEO Michael Regino said in a statement on Tuesday that the “four-stage” contribution rate hike readies the pension fund for the future needs of its members.
Regino added that the “four-stage” contribution rate hike will ensure the financial viability of the pension fund for the benefit of its members, pensioners, and their beneficiaries.
According to a report, the contribution rate hike is under the Republic Act No. 11199 (Social Security Act of 2018), which then-President Rodrigo Duterte signed in order to raise the contribution to 15% by 2025.
Under the law, a 1% contribution rate hike is imposed on SSS members every 2 years starting from 12% in 2019 until it reached 15% in 2025. The new contribution rate will be at 14% starting January 1, 2023.
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Regino also said that the SSS has already disbursed PHP 3.78 billion in unemployment benefits to more than 287,000 members from 2019 until October 2022. The annual maternity benefit disbursement also increased by 78% (from PHP 7.07 billion in 2018 to PHP 12.54 billion in 2022).
The SSS chief said that the previous contribution rate hikes boosted benefit disbursements for its members. He added that the latest actuarial valuation revealed that the pension fund’s life would last “until 2054”.
“The reforms in the contribution rates are among the factors that helped boost our fund life brought by Republic Act No. 11199 or the Social Security Act of 2018,” he said.
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