The Social Security System (SSS) has justified its scheduled contribution rate hike for 2025, claiming it will secure the long-term viability of the fund and extend its life to 28 years, doubling the projection from 2018.
Under the Social Security Act of 2018 (Republic Act 11199), the contribution rate will increase from 14% to 15%, alongside adjustments to the minimum monthly salary credit (MSC) from ₱4,000 to ₱5,000, and the maximum MSC from ₱30,000 to ₱35,000.
Ensuring Viability
SSS President and CEO Robert Joseph De Claro emphasized the necessity of these adjustments:
“The scheduled contribution rate and MSC increases are among the most important reforms under RA 11199 to ensure the long-term viability of the SSS.”
The adjustments are expected to generate an additional ₱51.5 billion in collections, with ₱18.3 billion allocated to members’ Mandatory Provident Fund (MPF) accounts.
De Claro added that the funds would support member benefits and assist the national government during crises, such as calamity loans, for which ₱9.7 billion was disbursed last year.
Extended Fund Life
The hike will extend the SSS fund’s viability to 2053, compared to the original projection of 2032 based on a 2018 actuarial study.
“Filipino workers will face more difficulties if we suspend or delay this. The funds will be used to improve future benefits,” De Claro said.
Mixed Reactions
Former SSS President and CEO Rolando Ledesma Macasaet urged Malacañang to suspend or phase in the increases to ease financial strain on members, a sentiment echoed by House Assistant Minority Leader Arlene Brosas. Brosas called the hike a “cruel New Year’s gift” amid high inflation.
In response, Executive Secretary Lucas Bersamin defended the increase, citing thorough actuarial studies:
“These increases are well-studied based on actuarial considerations. Meddling with such decisions could jeopardize the SSS’s management.”
Mandate and Goals
The SSS, tasked with providing social protection against life contingencies, aims to use the reforms to improve benefits, contribute to job generation, and ensure active participation in capital markets.
“Our goal is to make SSS relevant in the life of every Filipino by providing quality social protection and promoting savings for the future,” De Claro said.