Congress Must Override Aquino’s Veto, Ensure Living Pension for Retirees
The Freedom from Debt Coalition (FDC) joins the aggrieved 2.15 million pensioners of the Social Security System (SSS) in urging the Philippine Congress to override President Aquino’s veto and proceed to enact the law granting a PhP2,000 across-the-board increase in monthly pension. Further, FDC recommends that our lawmakers take this issue a step higher and immediately review the SSS social insurance scheme because clearly, this fails to protect members at old age. Not even with the P2,000 hike.
Paying attention to the financial security of retirees is long overdue. Beyond question, it is the government’s responsibility to ensure this. Aquino should be shaken out of his habit of rejecting proposals entailing public subsidies even if these would improve the lot of millions of Filipinos. Take the individual income tax cuts bills languishing in Congress, for example. And now the SSS pension increase.
Aquino complains of lacking funds for the pension increase, yet, there is roughly P510 billion that his administration failed to spend from 2011 to 2014. At the worst case of having no other alternative solution in sight, it would be enough to cover the additional expense for the P2,000 boost for the next nine to 10 years given the current SSS profit rate of 14 percent. Only then would the much feared drawing from the SSS Investment Reserve Fund (IRF) begin, and even then, the funds would last up to 2039-2040. This is not too far from the current longevity estimate of 2042 without the proposed hike. And even if it expires by 2042, won’t the government be able to replenish it via appropriation? Won’t SSS be able to raise premiums as workers’ income increases and collection rate improves?
Surely the government will find ways of providing for its citizens in the same way this administration has been finding ways of granting sovereign guarantees to corporations. FDC has been lambasting the numerous incentives given to private investors that have been causing billions of pesos in forgone revenues, unjust increases in the cost of water, electricity and transportation services, and swelling of government’s guaranteed debts. This year, contingent liabilities arising from the government’s Public-Private Partnership (PPP) scheme will be equivalent to 5.8 percent of the GDP or P915 billion. Still, the administration seems to be railroading the passage of the PPP bill which would entrench billions of pesos of annual appropriation for the Contingent Liability Fund or Risk Management Fund or public subsidy for risks and liabilities of private corporations.
While we are at it, why didn’t the Aquino government subsidize the SSS IRF when it has been too quick to do the same for the Bangko Sentral ng Pilipinas (BSP) using money from the Disbursement Acceleration Program (DAP)? Aquino gave BSP P30 billion for its recapitalization fund in 2014 when BSP willingly lent $1 billion of our money as bailout fund for failing European bankers via the International Monetary Fund’s Financial Transaction Plan!
Clearly, the president’s rejection of the pension increase is another shameless display of this administration’s double standards and misplaced priorities. It is already a disgrace that mere crumbs are thrown to the pensioners. Depriving them is an outrage! The only reasonable step for Congress to take is to override Aquino’s veto and move toward ensuring that the country’s social security system would live up to its name.
1 February 2016
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