THE Social Security System (SSS) is urging Congress to prioritize laws that will expand the pension funds’ capacity to invest, particularly in public-private partnerships, in line with the new thrust to use its members’ contributions as capital for infrastructure development.
In a statement on Tuesday, SSS Chair Dean Amado Valdez said this idea will directly benefit the working class who will own a stake in infrastructure projects.
“For the first time, SSS funds will be used in profitable projects nationwide. This new thrust has been motivated by the clamor of a higher pension and to ensure that the fund is sustainable in perpetuity,” Valdez said.
The fund is pushing for amendments to its Charter, specifically on the conservative provisions on investing capacity of the Social Security Commission. The SSS Charter limits the powers of the commission to invest reserve funds.
At present, the SSS could only invest in private securities (40 percent), housing (35 percent), real estate (30 percent), short- and medium-term member loans (10 percent), government financial institutions and corporations (30 percent), infrastructure projects (30 percent), foreign currency denominated investments (7.5 percent) and any particular industry that the commission deems profitable.
SSS also plans to diversify its assets by directly investing up to 25 percent ownership in a wide range of industries, including infrastructure projects like toll roads, real estate, utilities and lotto operations.
Valdez said the average return on investments (ROI) was 7 percent last year, but the pension fund intends to raise that to 15 to 20 percent next year, in view of the enhancements in investment practices and new investing projects and activities that it plans to carry out in the coming months.
“But we need the help of Congress to pass the SS Law amendments that will allow the SS Commission to execute these new investments” he said.