LAST week’s reports that the Social Security System (SSS) and the Government Service Insurance System (GSIS) have not yet complied with a congressional request for financial documents to justify that they need to increase members’ contribution rates is a cause for concern.
Congress has provided SSS generous support by passing Republic Act No 11199 in 2018 which gives SSS the authority to increase the contribution rate by 1 percent in each of year the years 2019, 2021, 2023, 2025. This means that the contribution rate which was 11 percent in 2018 will rise to 15 percent in 2025.
This means an increase of the income of SSS of 37 percent over this short time period before taking into account wage increases.
Yet SSS keeps talking about the depletion of the pension fund. We need more transparency so that we can better understand the justification of SSS’ assertions.
Premium rates were due, via RA 11199, to be increased to 13 percent this January but President Duterte in December 2020 reportedly ordered SSS to defer the implementation of the law. This is not our experience. We have recently attended our local (in Bacolod City) office where the increase for 2021 was enforced.
We need a government which can operate with greater clarity as to what our obligations are. Particularly when money is involved.
The calculation of our pension based on our premiums paid should also be made clear. Otherwise, we cannot be sure that we are being fairly treated.
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BANKING
I am uneasy about Bangko Sentral ng Pilipinas’ desire to engage in innovative developments. Theoretically, these seem reasonable, but I sometimes wonder of BSP is doing a good enough job in explaining to Bank customers that (a) the innovations are safe and (b) the benefits are tangible.
Last week’s BSP announcement that it aims to put in place an open finance framework which would enable ‘customer-allowed’ sharing of financial data in the second quarter arouses concerns. Firstly, I assume that it is the retail banks, not BSP, which would be responsible for implementation. Secondly, it is not clear to me that the banks will be ready for such a rapid implementation schedule. And thirdly, will customers have the genuine opportunity to say whether or not they wish to take part?
Unfortunately, data security is a problem. Last week’s report that at least 30,000 Microsoft email servers had been hacked is not reassuring.
Can BSP provide adequate assurances?/PN