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Palace exec: SSS bonuses come from agency revenues, not member contributions

President Benigno S. Aquino III graces the 55th Founding Anniversary of the Social Security System (SSS) at the Ramon Magsaysay Hall, SSS Building in Quezon City on Monday (September 03). The Anniversary theme, “Sa SSS: Kabuhayang Pinagsikapan, Seguridad Maaasahan” highlights the promise of SSS to protect the hard-earned contributions of its members - even their very livelihood - through prudent management of its investments, rationalized benefits programs, and streamlined operations. (MNS photo)

President Benigno S. Aquino III graces the 55th Founding Anniversary of the Social Security System (SSS) at the Ramon Magsaysay Hall, SSS Building in Quezon City on Monday (September 03). The Anniversary theme, “Sa SSS: Kabuhayang Pinagsikapan, Seguridad Maaasahan” highlights the promise of SSS to protect the hard-earned contributions of its members – even their very livelihood – through prudent management of its investments, rationalized benefits programs, and streamlined operations. (MNS photo)

MANILA  (Mabuhay) – A Palace official defended Thursday the hefty bonuses received by some officials of the Social Security System, saying the bonuses came from revenues generated by the agency and not from member contributions.

’Di po dun nanggagaling ang bonus. Bonus is contingent on revenue generated. ‘Yung contribution ng SSS members mapupunta sa buong fund ng SSS para sa ating mga members so they can make use of all the availaments under the SSS,” Presidential Spokesperson Edwin Lacierda said at a media briefing.

The SSS drew flak after it was reported that its board of directors received at least P1 million in bonuses, amid plans to hike its membership premiums.

Lacierda said the basis for making bonus announcements is set by the Governance Commission for Government Owned and Controlled Corporations (GCG) and certain requirements must be met before an official could be given a bonus.

“Even if it’s a good year for a particular GOCC, if the member of the board does not comply with certain requirements, not all directors get the bonus. We can only declare the bonus kung malaki kinita ng GOCC at malaki ang kinita ng SSS,” he said.

Lacierda, quoting from the SONA Technical Report, said “reforms in the SSS are being pushed to fund perpetuity and reduce its unfunded liability.

“SSS’ contribution rate (10.4 percent) is only half of GSIS’ rate (21 percent).

“For the Fund to last 70 years, which is the international standard for fund perpetuity, the contribution rate should be 14.1 percent.”

He added: “Since 1980, members’ contribution rate has only been increased twice (in 2003 and 2007), whereas across the board pension increases have been implemented 21 times.

“This has resulted in SSS’ unfunded liability estimated at 1.1 trillion in 2011. If members’ contribution is not increased, the Fund’s liability will increase by 8 percent per year and it’s actuarial life is projected to last until 2039 (28 years).

“To address these, the SSS, in consultation with labor and employer groups, has proposed to increase members’ contribution rate from 10.4 percent to 11 percent.

“This will help reduce by 8 percent per year and it’s actuarial life is projected to last until 2039 (28 years).”

SSS Pres. Emilio de Quiros Jr. earlier said SSS employees also got bonuses. He said the bonuses to employees were released in December 2012, while those for the board members were distributed only last month.

The Palace also expressed confidence that the SSS could defend the basis for the bonuses should the Senate call for a probe into the issue.

“We respect the prerogative of the Senate to look into it but we’re also confident that the declaration of bonuses to SSS directors are defensible and based on strict guidelines imposed by the GCG,” he said.

Senator Ralph Recto earlier said the agency’s charter should be reviewed and safety nets against abuses should be established. (MNS)

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