Driven by increased investment earnings, total annual incentive benefit (AIB) disbursements for 2014 of state-run Social Security System (SSS) have increased by P5.44 million.
Judy Frances See, SSS senior vice president for international operations, said the AIB disbursements rose to P12.68 million this year, from P7.24 million in 2013.
Launched in 2001, AIBs are additional income on savings of qualified overseas Filipino workers (OFWs).
Under the SSS Flexi-Fund Program, a voluntary provident fund and pension-plan scheme are exclusively offered to OFWs
See said a total of 37,612 qualified OFWs with active accounts under the Flexi-fund Program received 75 percent higher additional income on their savings.
Active Flexi-Fund members with no final benefit or full withdrawal claims filed for the year are qualified for AIB.
They may receive AIB disbursements each year on top of guaranteed earnings, depending on the actual year-end investment performance of the FlexiFund.
In 2014, members’ Flexi-Fund savings earned at an average guaranteed interest rate of 1.3 percent.
The guaranteed earnings are based on average rates of SSS’ short-term peso placements or 91-day Treasury bills, whichever is higher. ??
“The rates are re-priced quarterly to keep the program in step with prevailing market rates,” See said.
With the AIB disbursements, she added, total earnings credited to individual Flexi-Fund accounts swelled to P18.02 million, thus resulting in a higher average rate of return of four percent for qualified members.
See explained that the amount of total AIB disbursements is determined by deducting the total guaranteed earnings already credited to the accounts of the Flexi-fund members from the actual investment income of the Flexi-Fund at the end of the applicable year.
The maximum AIB disbursement that was credited to a member’s account last year amounted to P95,819.83.
As of December 2014, total Flexi-Fund equity of members grew to P448.3 million, up by 14.4 percent from the same period in 2013, with membership increasing to 44,626 OFWs as of year-end.
“We hope that more OFW members will choose to save under this program. SSS Flexi-Fund is safe and secure, which means they will get their savings as well as the interest earned in full to supplement their retirement fund or whatever benefits they will get from the regular SSS program in the future,” See said.
SSS Flexi-Fund savings are built from payments of at least P200 remitted on top of the SSS contributions of an OFW member, who is paying the maximum amount of P1,760 per month.
A one-time enrollment is required to be able to join the program.