Press Release
February 1, 2009

SSS money can't be diverted to stimulus fund without members' consent

Senate Minority Leader Aquilino Q. Pimentel, Jr. (PDP-Laban) today said the pension fund of the Social Security System cannot be used to augment the Arroyo administration's economic stimulus package (ESP) without the consent of its members.

Pimentel said that while there may be a good intention for channeling P12.5 billion of SSS fund to the ESP, it would be imprudent and even illegal for this financing institution to follow a Malacañang order for the fund transfer without securing the approval of the members who own the pension fund, which is held in trust by the government.

"The plan to use P12.5 billion from the SSS for the economic stimulus package may be pleasant to hear because many people will presumably benefit from it. But this is not the money of the government. This is owned by the worker-members in the nature of trust fund," he explained.

"It cannot be used for any other purpose (beyond giving social security benefits for members) except with the approval of the owners of this fund which comes from their premium contributions."

Pimentel said the diversion of a hefty chunk of the SSS pension fund is bound to adversely affect the actuarial stability of the fund which may be detrimental to the members.

At this point, he said it is not clear what are the mechanics for infusing Pl2.5 billion in SSS fund into the ESP, what specific projects it will be spent and who are the direct beneficiaries. He noted that there are talks it will be in the form of a "loan" from the SSS to the national government.

Instead of requiring the SSS to contribute to the ESP, Pimentel said it may be better for the System to expand the benefits of members by raising the monthly-pension of retirees, granting emergency loans and perhaps introducing unemployment insurance for members who have been displaced by the current economic crisis.

The minority leader said it would be pathetic on the part of SSS president Romulo Neri if his first major act since taking the helm of the agency a few months ago is to facilitate the transfer of P12.5 billion of the pension fund, which will may unnecessarily cause its depletion.

Worse, Pimentel said it would only give credence to the allegation that Corazon de la Paz was forced to resign as SSS president -- after successfully implementing measures to restore the viability of the pension fund - because she resisted Palace's attempt to dip its fingers into the fund.

He reminded Neri that upon taking over the helm of the SSS, he assured its members that any diversion or use of SSS fund that is contrary to the SSS will not happen during his term.

"Given these circumstances, my suggestion to the SSS members is to bring a suit against Mr. Neri over this questionable plan," he said.

Pimentel noted that the SSS is just one of the several government financial institutions being tapped by Malacañang to contribute to a P330 economic stimulus package.

He bewailed that the Palace has not bothered to secure authorization from Congress about the "fund-raising" raising scheme using funds of the GFIs. He said this does conform with the constitutional mandate that no public funds can be expended without the approval of the legislature.

In fact, Pimentel said the Palace has conveniently forgotten to inform Congress what the P330 billion ESP is all about and how it will be sourced.

News Latest News Feed