10% hike in SSS pensions OK’d

President Arroyo has approved a 10 percent across-the-board increase in the pensions of Social Security System (SSS) members.

The increase, which will be received by SSS pensioners starting next month, marks the second adjustment granted since September last year.

SSS president and chief executive officer Corazon de la Paz said the President approved the increase as recommended by the Social Security Commission, the policy-making body of the SSS.

“Starting in September, pensioners will
receive in their accounts the 10 percent increase retroactive to the month of August on top of their regular pension,” Dela Paz said.

Prior to the increase granted last year, the last hike in pensions was in 2000.

President Arroyo called for the new increase in the pension benefits last April.

Dela Paz said the increase would apply to pensioners in good standing as of July 31, 2007.

Concerns were initially raised that the grant of increases in the pension fund would adversely affect the actuarial position of the SSS.

SSS executive vice president and chief actuary Horacio Templo, however, assured the new increase would not affect the actuarial soundness of the pension fund, which he claimed has been extended to last until 2038.

In 1999, the actuarial projection of the SSS showed the pension fund would already be depleted by the year 2015,

In spite of the new increase granted to the pensioners, Templo said the SSS would still end up with a surplus of P2.6 billion this year from contributions and benefit payments.

He explained the surplus would be achieved because of the vigorous collection campaign of the SSS and the improving economic climate.

The President said the condonation of some 1.7 million delinquent SSS accounts in May 2006 resulted in the activation of around 200,000 SSS accounts whose status has since been brought to good standing.