Duterte still undecided on proposed SSS pension hike
MANILA, Philippines – President Rodrigo Duterte said he is still undecided on whether or not to approve the proposed pension hike for members of the Social Security System (SSS), citing his economic managers' concerns on the proposal's effect on the funds of the state-run insurance agency.
In an interview with ABS-CBN on Thursday, December 29, Duterte said Budget Secretary Benjamin Diokno and Finance Secretary Carlos Dominguez III are against the proposal because the SSS may go bankrupt.
“The end-game is that the government has guaranteed the solvency always of SSS so that if it runs short of money, government must go in. The problem is, you'll also involve non-SSS members, because you’ll get the money from taxpayers,” Duterte said.
"The problem is that we promised the people, so we will just have to go somewhere in there," he added.
Duterte also said that he has not yet signed proposals to increase the pension of SSS members, and is still studying these documents.
A joint resolution on the P2,000 SSS pension hike is currently pending before the House of Representatives and the Senate. The Senate will tackle the resolution when session resumes next month.
If the increase is approved, the first tranche can be released by January 2017.
But Dominguez, Diokno, and National Economic and Development Authority Director-General Ernesto Pernia earlier said that without an “upward adjustment or restructuring of the contribution rate,” the unfunded liabilities of the SSS would increase from P3.5 trillion to P5.9 trillion if the proposed pension hike is approved.
During the previous 16th Congress, a version of the proposed P2,000 SSS pension hike had been passed, but was vetoed by former president Benigno Aquino III, citing "dire financial consequences" for the SSS. The complementary bill to the pension hike measure was not passed in the Senate at the time.
The SSS had also supported Aquino's position, saying a hike would shorten its fund life. (EXPLAINER: Are SSS pension funds in peril?)
Duterte's hesitation to back the proposed pension hike is a departure from his position on the measure when he was a presidential candidate. When Aquino vetoed the pension hike in January, Duterte expressed sadness and urged Aquino to reconsider it for the sake of the elderly.
In January 2016, Duterte said, "I beg the President, the 2029 fear that [the SSS] would go bankrupt, you can correct it along the way."
"The purpose of the SSS is that you can have something in your old age.... Ang medisina talaga, kulang (There is not enough money to buy medicine). That's why mag-contribute ka (you contribute) – by the time you're no longer productive, that's the time you have to depend on the pension. Hypertension, diabetes management – kulang talaga ang pera (there's not enough money)," he said nearly a year ago. – Rappler.com