GRANTING a P2,000 pension increase across the board will leave the Social Security System (SSS) bankrupt, officials of the agency warned on Thursday.
Marissu Bugante, SSS Vice President for Public Affairs and Special Events Division and George Ongkeko Jr., SSS Vice President and Chief Actuary said if House Bill 5842 is approved, it will shorten the fund life and operations of SSS to 13 years or until 2029.
The Senate has approved a bill proposing a P2,000 pension hike. The same measure was approved by the House of Representatives on third and final reading.
The proposed hike aims to cover 1.9 million retirees.
“We are not against the pension increase, but we need to ensure the agency’s long-term viability. We would like to let the members understand that the P2,000 across-the-board increase for 1.9 million pensioners every month will only shorten the life of SSS from our previous projection of 27 years or until 2042 to 13 years or until 2029,” Bugante said.
They said the pension hike will jeopardize its 32 million active members.
“Based on our studies, SSS would need P49.5 billion because of the increase. For the full period of 2014, SSS just earned net revenue of P45.5 billion only,” she said, noting that the agency would fall short of P4 billion in its first year of implementation if the bill is passed.
“Where do we get the money to fund the pension increase?” she asked.
Ongkeko said if the bill become law, the monthly contributions of the 32 million active members will have to be increased by 44 percent.
“We also want an increase for the pensioners, but not a legislated one. To the active members, this must also be your concern because what we are talking about is the issue of your future pension,” Bugante said.