SSS’ scheduled contribution rate increase

SSS’ scheduled contribution rate increase

“The habit of saving is itself an education; it fosters every virtue, teaches self-denial, cultivates the sense of order, trains to forethoughts, and so broadens the mind.”

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This photo was taken from: Facebook: Philippine Social Security System – SSS

 

On 04 January, the Social Security System said that the scheduled increase in its contribution rate and minimum and maximum monthly salary credits (MSCs) is to guarantee the continuous delivery of social security protection to its members and their beneficiaries.

SSS President and CEO Aurora C. Ignacio claimed that the SSS has responded to the requests of various labor organizations and members to delay the mandated increases; however, the move is intended to protect the SSS‘s fund sustainability.

 

“Moreover, these scheduled reforms are pursuant to Republic Act No. 11199 or the Social Security Act of 2018. Thus, we are bound by law to implement it,” Ignacio added.

The SSS contribution rate was raised to 13% in January 2021, up from 12% previously. The minimum monthly salary credit (MSC) has been increased from ₱2,000 to ₱3,000 (except for Kasambahay and OFW members, whose minimum MSC will remain at ₱1,000 and ₱8,000, respectively), while the maximum MSC has been increased from ₱20,000 to ₱25,000.

The additional 1% would be shared between OFW members and their employees, resulting in a contribution rate split of 8.5% for employers and 4.5% for them.

Although the MSC is capped at ₱20,000 for purposes of calculating compensation under the regular social security program, excess MSC contributions will go to the Worker’s Investment and Savings Program (WISP), a provident fund that will provide extra pension income to members who contribute to it.

The SSS stated that the changes would allow members to put more money aside for retirement. The SSS continues to be the cheapest and most available pension plan in the world, with seven different benefit plans and loan privileges.

Ignacio mentioned that any delay in enforcing the reforms could jeopardize the SSS’s fund operation and opportunity to provide benefits and loan privileges to its members and beneficiaries, particularly in this moment of the pandemic.

To know more about the 2021 SSS contribution payment schedule, you may refer to this link: https://bit.ly/3cSiRse

 

This photo was taken from: Facebook: Philippine Social Security System – SSS

 

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