SSS says no funds to finance expanded benefits, reiterates need for rate hike

The Social Security System (SSS) on Monday defended anew its scheduled rate hikes, saying it has no funds to finance the expanded benefits which the agency has been implementing since 2017 as mandated by the law.

SSS president and chief executive officer Aurora Ignacio said the rate hikes will finance three additional benefits that are currently being implemented -- the P1,000 additional monthly benefit allowance, as well as the expanded 105-day maternity benefit and the unemployment insurance benefits.

"Right now these are all ongoing benefits being received by our members and pensioners, and those were unfunded during the time when it was approved and implemented. The reforms that will be instituted on the increases up to 2025 is just to fund all of these benefits," she said in a virtual meeting with the House of Representatives.

To recall, Malacañang in 2017 approved the release of the additional P1,000 monthly pension for retired SSS members while the expanded maternity and unemployment benefits were set in place in March 2019.

"If there will be delays in reform implementation we see that it will worsen the financial position of the SSS," Ignacio added, as she earlier said postponing the rate hike would result in a P41.37-billion loss in 2021.

Under the Social Security Act (SSA) of 2018, the SSS has scheduled increases in the monthly contribution of its members to ensure the long-term viability of the pension fund and increase benefits moving forward. This mandates an increase of 1% almost every other year, and brings the maximum salary benefits to at least P25,000.

However, lawmakers are looking to defer the increase scheduled this year, citing the economic difficulties brought about by the COVID-19 pandemic. Such measure which allows the President to defer the increase was approved at third and final reading at the House of Representatives earlier this month.

For her part, Ignacio on Monday defended the increase, but she earlier said the agency will comply should Malacañang defer the hike.

The SSS is mandated to promote social justice and provide protection to members and families against the hazards of disability, sickness, maternity, old age, death, and other contingencies resulting in loss of income or financial burden. — RSJ, GMA News