February 20, 2017, 4:38 pm
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Bitter pill

PRESIDENT Duterte appears to have found a common ground with his predecessor.

He now shares Aquino’s view that approving the P2,000 increase in benefits for Social Security System’s pensioners, while not exactly a death warrant for the pension fund, would unfairly shift the burden to other taxpayers who do not stand to gain anything.

Malacañang claims there might yet be a win-win solution where everybody ends up happy.

The problem is the combined brains of three of the administration’s chief economic managers do not share such optimism.

There is simply no way to grant an increase to 1.9 million pensioners without shortening the system’s fund life by at least a full 10 years or requiring a subsidy by way of legislation. And that is precisely the President’s catch-22: he hates the idea of burdening other sectors that have nothing to do with SSS.

That is not to say, retired and elderly SSS members do not deserve to be helped. In fact, such assistance is already long overdue as their pensions have shrunk in buying power over the years to make the “social security” part almost laughable.

Several steps have been suggested to shore up SSS funds including improving collections, going after delinquent employers, and chopping off the paycheck of agency officials. Yet there are doubts even these would be enough to bridge the gap that the proposed increase will create to the tune of P16 to 26 billion each year.

There are other potential solutions like relaxing the investment rules for SSS reserve funds and putting undistributed collections to work while awaiting reconciliation with the members’ accounts but they still require a careful study and time that the situation does not allow.

Cabinet officials have snarled at Congress for putting the President on the spot apparently overlooking the fact that the problem started with a campaign promise. The problem however, is now beyond politics.

The government has to make a decision soon and it is unlikely that anyone will emerge out of this unscathed. – PT.
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