THE temporary chief occupant of Malacañang has dared his critics to prove him wrong in vetoing a piece of legislation increasing by P2,000 the monthly pension of member retirees of the Social Security System. He should be told that his challenge did not make him look more assertive or more presidential, as he considers himself to be.
Instead of providing us with the actuarial computations, he showed us his mastery of “datos.” Ergo, he concluded, a P2,000 pension increase would lead to SSS’s bankruptcy. Of course, he did not use the words “bankrupt” or “bankruptcy” in denying SSS’s aging and aged pensioners the right to live more comfortably.
How did Malacañang’s casual tenants led by their chief come out with certain amounts without providing the basis for the computations?
When they talked of shortfall in investment income to meet pension expenses, they, in effect, have basically judged SSS to have failed miserably in choosing the best investment options for the funds contributed by SSS members. Incidentally, they did not include executive compensation in their actuarial.
Saving SSS a priority
Reciting a litany of justifications to save SSS from bankruptcy is not the proper way to explain “P56-billion total payout annually, P30 billion to P40 billion annual investment income and a deficit of P16 billion to P26 billion” a year. Couldn’t Malacañang give us the exact figures?
Finally, SSS and Malacañang quoted “annual investment income of P30 billion and P40 billion” but did not disclose the total investments on which it based the computations. Instead, its tenants let pensioners do the research for them to find the unknown.
By the way, the P10-billion gap appeared in both deficit and annual investment income. What a coincidence!
Since Malacañang’s chief temporary tenant did not disclose how SSS has been investing its members’ money, Due Diligencer researched SSS’s significant holdings in Union Bank of the Philippines and Philex Mining Corp.
SSS member pensioners are invited to do their own interpretation of the data to prove Malacañang wrong about SSS.
P9.56B in UBP
SSS members, along with member pensioners, should have been told that they are UBP stockholders.
A posting on the website of the Philippine Stock Exchange showed SSS as a UBP direct stockholder owning 115.13 million shares, or 10.88 percent. The same filing also listed the bank as an indirect owner of an additional 55.58 million UBP shares, or 5.2 percent, lodged with PCD Nominee Corp.
As holder of a total of 170.71 million UBP shares, or 16.1 percent, in UBP, SSS elected two nominees to the bank’s 15-person board. Emilio de Quiros Jr., SSS president, and Eliza Antonino are the SSS members’ representatives to the bank’s board since 2010.
De Quiros and Antonino were among the beneficiaries of the UBP’s board pay and perks of P23.25 million in 2012; P30.49 million in 2013; and P37.1 million in 2014.
On the other hand, SSS members may be considered very rich with their UBP shares having a market value of P9.56 billion. In addition, they received P2.10 per share dividend or a total of P358.50 million, on May 20, 2015. The dividend translates to a gross return of 3.75 percent, which, when divided among 2,000 members, would be equal to nothing.
P4B in Philex
As a direct stockholder of Philex, SSS owns 864.44 million shares, or 17.50 percent. It is also an indirect stockholder of the mining company, owning 152.8 million shares, or 3 percent, that are lodged with PCD Nominee Corp. These add up to 1.02 billion shares, or 20.6 percent, with a market value of P4.07 billion at P4 per share.
These holdings entitle SSS to two seats in Philex’s 11-person board. As SSS’s nominees, Bienvenido Laguesma and Eliza Bettina Antonino were elected directors to their first term in 2013 and 2011, respectively. They are both members of the Social Security Commission, which is SSS’s governing body.
As directors, Laguesma and Antonino were among Philex’s 11 directors who received compensation of P121.26 million in 2012; P33.83 million in 2013; P10.46 million in 2014 and an estimated P11.95 million in 2015.
If Philex is generous to its executives and directors, it may not be as generous to its stockholders. On March 25, 2015, it paid P0.02 per share dividend. Computed at P4 per share, the dividend translates to 0.005 percent per annum, giving SSS a total dividend of P20.34 million.
Will Malacañang and SSS properly disclose the latter’s total investments that generated an annual return of P30 billion to P40 billion? Their disclosure would enable the funds’ member workers and pensioners to compute the rate of return per annum—or yield in percent—of their hard-earned money.
Finally, SSS should review its investments in listed stocks. Should it invest members’ contributions to the extent that it would be entitled to a board seat or more? SSS is not in the stock market for corporate control but for better yield for its members’ money.