Because we can’t afford it.
“President Noynoy Aquino returned Congress House Bill No. 5842 without his signature, vetoing the proposed law seeking to increase the monthly pension of Social Security System (SSS) pensioners by PHP2,000,” reports Willard Cheng on ABS-CBNnews.com.
According to the report, Aquino cited the bill’s negative effect on SSS income. “The stability of the entire SSS benefit system, whose present membership comprises about 31 million individuals, will be seriously compromised in favor of two million pensioners and their dependents,” he said.
The bill had also sought to adjust the minimum monthly pension of members who have contributed 10 credited years of service (CYS) from PHP1,200 to PHP3,200; and PHP2,400 to PHP4,000 for those with at least 20 CYS.
Aquino reasoned that “multiplying the proposed PHP2,000 across-the-board pension increase by the current number of more than two million pensioners will result in an annual payout of PHP56 billion.”
Aquino’s statement further explained: “Given the annual investment income of 30 to 40 billion of SSS, the President said that the payout would lead to a deficit of PHP16 billion to PHP24 billion annually. This would have led, he said, to SSS drawing from its Investment Reserve Fund (IRF) to support the pension increase, hence diminishing it and eventually reaching zero by the year 2029.”
