MANILA - Wage earners need to contribute more to the Social Security System (SSS) so that it can shoulder the planned hike in benefits for retirees, the pension fund's chief reiterated on Thursday.
SSS President and CEO Emmanuel Dooc said the pension fund shelled out P33 billion in 2017 for the P1,000 hike in retirees' pension approved by President Rodrigo Duterte last year.
This was the first tranche of a P2,000 hike in SSS pension benefits promised by Duterte when he was still running for President.
A second P1,000 increase in pension benefits next year would drain the funds of the SSS within 7 years, the pension fund warned earlier.
"Under a do-nothing scenario, meaning we'll not increase the contribution rate, then fulfilling the promise will be a very tall order for us," Dooc said in an interview with ANC's Top Story on Thursday.
The SSS wants to hike the contribution rate from 11 percent at present, to 12.5 percent or 14 percent.
The contribution rate was supposed to be raised to 12.5 percent last year, but the SSS said it opted to wait for the passage of the first tax reform package, which would ease the burden of higher SSS contributions on income earners.
Besides hiking the contribution rate, Dooc also proposed raising the salary ceiling for contributions from P16,000 to P20,000 and the minimum salary level from P1,000 to P4,000.
He said that the pension fund has also been working to raise its collection rate over the past year.
SSS collections grew 10.6 percent to P159 billion by the end of 2017, Dooc said.
"It's a substantial increase, for January to April 2018, we have collected P62.5 billion," he added.
But he said the pension fund needed an Executive Order or a legislative amendment to the SSS charter to hike the contribution rate and offset the promised P1,000 increase in pension benefits.