MANILA – Monthly contributions to the Social Security System (SSS) will rise to 13 percent of members’ incomes starting January 2021.
This is higher than the current 12-percent contribution drawn from members’ salaries, the Social Security Commission (SSC) said.
For the minimum monthly salary credit (MSC) of P3,000, the new rates would mean a P390 contribution from the current P320.
MSC determines the level of contributions and benefits per member based on their monthly earnings.
SSC Chairman and Finance Secretary Carlos Dominguez said the rate increase will secure the long-term viability of the pension fund, and expand coverage and benefits for members and their beneficiaries as provided for under Republic Act No. 11199 or the Social Security Act (SSA) of 2018.
“Upon full implementation in 2025, the reforms under the SSA of 2018 will offset the adverse financial impact of the P1,000 pension increase granted in 2017,” Dominguez said in a statement.
“Any drop in collections may lead to cash flow and liquidity issues. This could endanger the SSS’ ability to provide its members and their beneficiaries with benefits and loan privileges,” he added.
The new contribution rates also expanded benefits that members and their beneficiaries can get which include sickness, maternity, unemployment, retirement, disability, death, and funeral benefits.
He hoped that members could see this as “savings and safety net” against any sicknesses, loss of income stream, or other contingencies.
Through the SSA, the SSS last year introduced the unemployment benefit for members involuntarily separated from their jobs, and extended the MSC cap for the computation of benefits to P20,000.
SSS distributed P159.47 billion in social security and benefits from January to October to a total of 3.56 million members and beneficiaries — a 2.6-percent decrease as disbursements were slowed at the height of the COVID-19 pandemic.
Employer groups earlier called on SSS and Philhealth to delay the contribution hikes to provide relief for Filipinos as the COVID-19 pandemic left 4.5 million people jobless, and others with lower incomes and shortened work hours.
Source: ABSCBN News
