Despite the decline in its collected revenues last year, the Social Security System (SSS) has to follow the law and defer raising premiums until 2025.
In an online briefing last Tuesday, SSS President and CEO Aurora C. Ignacio said the agency’s revenue collection last year dropped by 7.8 percent from the P223 billion collected in 2019.
Ignacio further said the pension fund manager was only able to collect P206 billion in 2020 as many businesses shut down and laid off workers.
She added the SSS would not hike its premiums to make up for the lost revenue in compliance with the schedule set by Republic Act (RA) 11199 or the SSS Act of 2018.
“The [SSS] management or commission cannot just increase [premiums] when it wants to since it is included in the law,” Ignacio explained citing the premium increase stipulated in RA 11199 is in 2025.
Currently, she said SSS maintains a P625-billion fund, which is used to provide for the benefits of its members. Ignacio said there would be an actuarial valuation in 2023 to determine how Covid-19 affected the fund’s life.
“Based on the actuarial valuation, which is in 2019, our fund life would last until 2054. But that actuarial valuation did not include the Covid-19 pandemic,” Ignacio said.
RA 11199 states that valuation should be done every three years. The valuation to be held in 2023 would use 2020 figures, according to the SSS chief.
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