MANILA – The Social Security System will start implementing the new rate of 11 per cent in monthly contribution beginning January 2014 as previously announced. The current rate of contribution is 10.4 per cent regularly collected by the state-owned pension fund.
The increase in contribution rate is part of the SSS reform agenda that seeks to lengthen gradually the actuarial life of the Social Security Fund as explained by SSS president and chief executive officer Emilio S. de Quiros, Jr.
According to De Quiros, the 0.6 percent increase will be divided equally between employees and employers.
On the other hand self-employed and voluntary members will shoulder the entire 11-percent contribution.
Thus, the employees will shoulder the 3.63 percent, while the employers will pay the 7.37 percent based on the applicable monthly salary credit (MSC).
For an instance, if the MSC is P5,000, the monthly contribution will become P550.00 and if the MSC is P16,000 the monthly contribution will become P1,760.
The SSS also advised the members who already paid advance premiums to review and update their payments in line with the new contribution rate when it takes effect by January 2014.
According to SSS, the member should pay the difference using the Contributions Payment Return for SE/VM or RS-5 form and indicate that it is for the underpayments.
If no appropriate adjustment is made, the SSS will post such advance payment at the applicable lower MSC, then the excess in the amount of advance contribution will be refunded upon the member’s request.
Prior to the increase, the SSS said that for the past three years, it has conducted consultation meetings with various groups including employer and worker organizations, to generate understanding and support for its proposed reforms.
During President Benigno S. Aquino III State of the Nation Address (SONA ) last July, he declared support for the need to increase the SSS contribution rate to help address the growth of its unfunded liabilities.
The increase was affirmed by SSS Resolution No. 711-s.2013 dated September 2013 stating that the increase will be effective by January 2014. (PNA story by Leilani S. Junio)
THIS ARTICLE IS RELATED TO social security