By RONALYN V. OLEA
MANILA –President Aquino’s veto of the pension hike bill angered workers, netizens and other sectors.
Aquino stated he could not support the bill because of its “dire financial consequences.” The House Bill 5842, mandates a P2,000 ($42) across-the-board increase in SSS monthly pensions.
The principal author of the bill, Makabayan senatorial bet Neri Colmenares, quickly denounced the veto. “Walang puso ba talaga si President Aquino? This is patently anti-pensioner, anti-poor and anti-worker!”
Colmenares called on the House of Representatives and the Senate to side with the people and override the Aquino veto.
‘SSS has enough resources’
Contrary to Malacañang’s claim that the SSS pension hike would result in a deficit of P16 billion to P26 billion ($334 million to $543 million) and “compromise the stability of the entire SSS system,” a labor NGO said SSS has enough financial resources to shoulder the pension hike cost.
The Ecumenical Institute for Labor Education and Research, Inc. (Eiler) said Malacañang did the wrong computation to make it appear that the cost of the SSS pension hike outweighs SSS income from investments.
Eiler research coordinator Carlos Maningat said SSS total revenues, which consist of members’ contributions and income from investments, amount to P160 billion ($3.34 billion) annually on average. The group noted that the amount is way bigger than the projected annual payout of P56 billion ($1.17 billion) for SSS pensioners.
Maningat added that aside from its annual revenues, SSS has also over P428 billion ($8.95 billion) in investment reserve funds as of April 2015, which is being invested in equities, bank deposits, securities and real estate.
“With billions in investment reserve funds, increasing income from investments, and growing contributions from a widening member base, SSS is definitely poised to extend its fund life. There is no way that the state pension fund will go bankrupt just because of the pension hike,” Maningat said.
Based on Eiler’s study on social protection, it is clear that contribution collections continued to outpace benefit payments, yielding a contribution surplus of P12 billion ($251 million) in 2013, 16 times higher than the surplus posted in 2012 and five times more than the surplus earned in 2010.
Colmenares said the proposed P2,000 hike “is very reasonable and is badly needed by pensioners and their dependents.”
Since 1997, the SSS minimum pension has been a measly P1,200 per month, which Colmenares said is “a certainly a sub-human pension level.”
Based on actual inflation figures, the value of P1,200 ($25) month is worth P519 ($11) in 2014. The pension of those receiving P2,400 ($50) per month is now worth P1,038 ($22). These, the author of the bill, said, are way below the living wage of P5,333 ($112) a month for a single person.
Colmenares originally proposed a P7,000-per month ($146) minimum pension. He said the P2,000 ($42) increase, a compromise amount, is not actually enough to meet the needs of SSS pensioners but hopefully can start to increase the ability of pensioners to meet basic necessities.
Colmenares said the SSS refused to fix the low pension level and the dismal state of its pensioners for almost two decades. Under Section 4 of Republic Act 8282, the SSS is supposed to submit a review of the pension system every four years to find ways to increase the pension of its members, but no such study was undertaken.
Netizens responded to Kilusang Mayo Uno’s call to use social media “to express their disappointment, dismay, condemnation and anger over Aquino’s move.”
Using the hashtag #WalangPuso, netizens condemned the veto via Twitter and Facebook.
KMU announced it would hold a protest action near Malacanang January 15.
Renato Reyes Jr., secretary general of Bagong Alyansang Makabayan (Bayan), posted on Twitter the Commission on Audit’s report on salaries and allowances of SSS officials in 2014.
Reyes pointed out that SSS chairperson Emilio De Quiros Jr. received a total of P6.8 million ($142,000) in 2014.
“The long-awaited pension hike had to go through the whole legislation process only to be vetoed by the President, while SSS executives award themselves humongous bonuses and put our workers’ hard-earned money to risky investments,” Maningat said.
Government subsidy possible
Colmenares said under the RA 8282, the government has the obligation to appropriate funds should the SSS fail to replenish the projected P4-billion deficit resulting from the pension increase. There can never be a bankrupt pension system because government will always intervene if necessary.
The senatorial candidate said the SSS itself failed to do institutional reforms for nearly 20 years, so it has only itself to blame.
He said that instead of being deluded by the promise of SSS of pension increase after institutional reforms, Congress will have to assert its power to mandate a pension increase and at the same time work for institutional reforms in the next five years to strengthen SSS and enhance its fund life.