The Social Security System will implement the new contribution rate this month to ensure the viability of the State insurer’s operations and for members and their beneficiaries to continue receiving their benefits.
SSS Vice President for Luzon North 1 Division Ceasar P. Saludo said amidst calls for suspension, they have to implement the 13 percent contribution rate, which is one percent higher than the 12 percent rate in order not to compromise the benefits of members and their beneficiaries.
“If we do not implement the one percent increase, the benefits of the current members and the incoming members will be compromised. We understand the plight of members, but we have to balance the impact (of not implementing the new rate) on those currently receiving their SSS benefits,” Saludo said.
He added the 13 percent contribution rate is mandated by Republic Act 11199 or the Social Security Act of 2018.
Baguio Rep. Mark Go has filed a bill that sought to defer the implementation of the 13 percent contribution rate for at least two years in deference to the financial difficulties suffered by private sector workers and their employers due to the Covid-19 pandemic.
The amount collected from the SSS contributions is used to subsidize the benefits of members, such as retirees receiving their pensions and those claiming maternity, disability, unemployment, death, and burial claims.
Saludo said the pandemic has also adversely affected the collection of SSS contributions because of the closure of establishments that resulted in unemployment and lesser number of new members, among other factors.
He said for SSS Luzon North 1, collection in 2020 was P2.4 billion, which is lower than its P2.6B target.
SSS Baguio, which collects the largest for Luzon North 1, collected P738 million last year, which is nine percent lower than the P831M it collected in 2020.
The number of new members last year only reached 17,406, which is more than 50 percent lesser than the 38,000 new members in 2019.
The payment of unemployment benefits by SSS has aggravated SSS’ reduced collection last year.
Saludo said Luzon North 1 shelled out P84M for the unemployment benefits of 6,329 workers who lost their jobs due to the impact of the pandemic.
SSS Baguio paid P25M for the unemployment claims of 1,906 employees.
The unemployment benefit is a recent addition to the various benefits enjoyed by SSS members. It became effective two years ago. – Jane B. Cadalig
April 26, 2024
