SSS contributions a factor in pension
This refers to Bernardo V. Peralta’s letter about the Social Security System (SSS) titled “Are very low SSS pensions moral?” published in the Inquirer on Nov. 4.
The amount of pension is based on the highest computation resulting from the three formulas provided by the Social Security Law. A major factor in pension computation is the monthly salary credit (MSC), or the amount of income covered by a member’s contribution. But in the SSS structure, the maximum MSC has remained at low levels in comparison with the actual income of members, therefore limiting the amount of the computed SSS pension.
The current pension design is not indexed to inflation, and the Social Security Law specifies that pensions may only be raised if the actuarial viability of the fund is ensured. If we want pension levels to be more meaningful, there is a need to make major changes in its structure. The reform agenda pursued by the SSS management is precisely intended to address the needs of members for higher benefits, as well as to strengthen the SSS’ financial viability.
—MARISSU G. BUGANTE,
vice president,
Public Affairs and Special
Events Division,
Social Security System
