Kabayan Weekly Pool Report
PHILIPPINE President Rodrigo Duterte recently signed into law Senate Bill 1753, or the “Social Security Act of 2018,” which widens the scope of the Social Security System (SSS), extending it to all overseas Filipinos (OFs) around the world.
The new law requires SSS coverage for overseas Filipino workers (OFWs), whether land-based or sea-based.
Executive Secretary Salvador Medialdea on Friday, February 15, said the President has already signed the law meant to ensure the longterm viability of the SSS fund, which will supply Filipinos with their pension when they retire.
The new law, Republic Act No 11199, expands the powers and duties of the Social Security Commission and repeals the Social Security Act of 1997.
The actual date of implementation, however, and its specific details have yet to be released through the Implementing Rules and Regulations (IRR).
Currently, only around 500,000 OFWs are covered by SSS since contributions are voluntary. With the new law, SSS membership of OFs could increase to 2.5 million.
Senator Richard Gordon, one of the bill’s authors, previously said the measure’s passage would “expand, protect and increase the SSS fund so that when the time comes, there would be available pension for the people.”
The new powers provided by the law allow the SSS management to increase the salary credit and contribution of employees “considering that at present it is only limited to P16,000 which yields very little benefit,” Gordon added.
Foremost among those who are expected to benefit are overseas Filipino workers, who will be mandated to make monthly contributions for them to be entitled for pension fund and other benefits once they call it quits on their professional careers.
Mark Roue Oliva, the SSS representative in Dubai, said the government-run provident fund will benefit both land-based and sea-based OFWs, including those in the UAE.
“Because contributions were voluntary for OFWs (overseas Filipino Workers) in the old law, most OFWs, majority of whom are from the Middle East, forget to contribute. So, once they retire, they are not qualified to get pension from SSS,” Oliva told Gulf News.
In Dubai, more than 7,000 Filipinos paid their premium in January 2018. But, the average contributors for 2018 for Dubai and the northern emirates was just 4,800.
An estimated 600,000 to nearly one million Filipinos work in the UAE.
All SSS benefits enjoyed by members in the Philippines, such as lifetime pension and other benefits, including salary loan, sickness, retirement, maternity, disability, death, funeral, are also being received by OFWs in the UAE, he explained.
“I would like to emphasize Senator Richard Gordon’s earlier statement that the bill [now law] does not promise an abundance of wealth but to secure people in case they would encounter unwanted situations in their lives. It is better to be covered than have nothing,” Oliva said.
“For maternity benefits, for example, I process, at least, 20 claims in a month. I have also processed retirement claims. The processing takes roughly one month and the cheque is deposited directly to the claimant’s bank account,” he added.
The benefits vary depending on the monthly contributions. For those paying the maximum amount based on the old law of PhP1,750 (Dh126) per month, for example, they receive a maximum maternity benefit for caesarean amounting to PhP41,600. For normal delivery, the benefit is PhP32,000.
Those with minimum contribution of PhP550 get PhP10,000 as benefit for normal delivery and PhP13,000 for caesarean.
“These contributions and benefits may change based on the new IRR. But, the main message to our compatriots is not to treat SSS as an expense but an investment. Every peso they contribute will be given back to them or their beneficiaries through a pension or lump sum. This is one of the ways that they can invest in themselves and in their future,” Oliva added.
Major changes are also expected to take place within the charter and board membership of the SSS after President Duterte recently stamped his approval over the new law that will ensure the long-term viability of the SSS fund.
The law “professionalizes” the SSS board, the entity that manages the critical fund, by requiring that board members be a professional in law, management, banking, or insurance.
It also gives the SSS more powers and allows for reserve funds to be invested for them to grow.