Press Release
January 18, 2017

'SSS deduction is payroll tax so buck stops with President, not with unelected bureaucrats' -- Recto

Because it is a payroll tax, the power to approve the rate of a Social Security System member's monthly contribution should remain with the President, Senate Minority Leader Ralph Recto insisted today.

"When it comes to any mandatory deduction from a workingman's income, the buck stops at the president's table," Recto said in reaction to legislative proposals to delegate the power to set and approve SSS premiums to the multisectoral Social Security Commission.

"If you divest people of part of their income, then is better that such power be vested on an individual with a mandate from the people," Recto said.

"The President is the best trustee for SSS members. Kasi binoto. Hindi 'yung appointed mula sa isang maliit na sektor, tapos bibigyan mo ng karapatan na magkaltas ng payroll tax. Siya 'yung stakeholder representative na may clear mandate," Recto said.

"Remove him from the equation, then the SSS becomes an autonomous republic," Recto said.

Because employers put in a counterpart to their employees contributions, "then all the more it becomes important for any increase to have presidential imprimatur."

"He is the only one who can convince corporate Philippines as well as small businessmen that such an increase is needed," Recto added.

In setting the schedule and rate of members' contributions, Recto explained "that the Commission can recommend but the President must concur."

While a good President, Recto said, "must always heed the views of professionals who run the pension system, it is better to give the final say to President as some sort of a fail-safe mechanism that can override bad recommendations."

"We need the President as a tripwire against onerous increases. He can greenlight but he can also abort," he said.

Recto downplayed fears that allowing the President to retain that power will politicize the process.

"The President is not up for reelection so he can make tough decisions. That he is term-limited makes him immune from populist pressures," Recto said.

"No President would like to be remembered as someone who bankrupted the SSS," he added.

On the contrary, Recto said granting the President oversight powers over the pension system will allow him to lean on it so it will improve "its bottomline, increase its income and expand membership benefits."

Recto said the SSC can be given the authority to fix and determine the benefits, condone penalties imposed on contributions and loan amortization, and amend the penalty for delinquent contributions "without the need for prior approval of the Philippine President."

"Pero pagdating sa contributions, na isang payroll tax, kailangan may approval ng Presidente," he said.

Recto had filed SSS reform bills in the previous Congress. For the present one, he packaged his proposals under Senate Bill 63.

A summation of some of his recommendations was highlighted in his sponsorship speech of the SSS Pension Hike Bill early this year. (

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