Press Release
January 19, 2016


Sen. Francis "Chiz" Escudero slammed the Social Security System (SSS) for using the "threat of bankruptcy" to prevent the Congress-ratified P2,000 across-the-board increase in the monthly pension of its members from being enacted into law.

Escudero said such position by the private sector pension fund, which became the basis for President Aquino to veto the SSS pension hike bill, was merely an excuse for the "inefficiencies" within the agency, as he insisted that the increase was "doable and financially viable."

"Ang panakot o scare tactic ng SSS ay mababangkarote raw ang ahensya at mauubos daw ang pondo nila kapag tinaasan ang pensyon ng mga retirado. Sa tingin ko ay palusot lamang ito. Kung gusto may paraan, kung ayaw maraming dahilan," Escudero said.

The veteran lawmaker said it would not be difficult for the SSS to fund a pension increase if major institutional reforms have been put in place to make the pension fund sustainable and viable over the long term.

Escudero, the frontrunner in the vice-presidential race, noted that the failure of past and present SSS officials to establish an efficient collection system for contributions from employers who failed to remit employees' share.

He said the SSS may also consider alternative ways of generating revenue like condoning penalties on overdue loan obligations by members, instead of focusing on giving fat bonuses to its executives.

"All it takes is for the SSS to be more innovative and focused on fixing the inefficiencies that impede them from giving retirees in the private sector the much-needed increase in their monthly pension," Escudero pointed out.

At the 2009 Senate proceedings for the approval of the SSS Condonation Law, it was discovered that SSS had failed to collect a total of P94 billion from employers. At the end of the condonation period, only 24,043 employers availed themselves of the program by remitting P3.545 billion.

In an SSS report dated Jan. 12, 2013, there were 174,985 delinquent employers with total liabilities of P8.515 billion as of Dec. 31, 2010. The number did not include the 131,907 intermittently paying and delinquent employers with total liabilities of P8.005 billion.

SSS failed to collect P13 billion from delinquent employers as of 2014 while its aging member loans amounted to P64.01 billion, of which P19.407 billion represents outstanding loans of more than five years.

Despite this, the SSS is notorious for giving hefty bonuses to its top executives.

In October 2013, the SSS came under fire after eight members of its board got a performance bonus of about P1 million each for the state-run firm's performance for 2012. SSS employees were also given bonuses worth P276 million in 2012.

Reports about the bonus bonanza came out the same month the SSS announced an increase in the monthly members' contribution from 10.4 percent to 11 percent effective Jan. 1, 2014.

According to the SSS, the P2,000 across-the-board increase for 1.9 million pensioners every month would shorten the life of the pension fund from its previous projection of 27 years or until 2042 to 13 years or until 2029.

Escudero said the bankruptcy threat is baseless because the government, under Republic Act No. 8282 or the Social Security Act of 1997, has the obligation to allocate funds should the SSS suffer from insufficient funding brought about by pension increase.

"The solvency of SSS is guaranteed by the government. This means it may infuse funds to the SSS to strengthen its fund life, as well as its capacity to provide services to its members," he pointed out.

Escudero earlier rallied his colleagues in Congress to override the President's veto of the SSS pension hike bill that would have benefited close to two million pensioners.

"There is no better time than now to have the SSS pension hike bill enacted into law, and I urge my colleagues in the Senate and members of the House of Representatives to do the right thing and vote to override the President's ill-advised veto of this bill," he added.

Under Article VI, Section 27 of the 1987 Constitution, Congress can override a presidential veto by passing the bill with a two-thirds vote in both the Senate and the House of Representatives.

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