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With the
reported sale by Social Security System (SSS) of its
shareholdings in San Miguel Corp. that fetched the
pension fund P13.2 billion in cash, it is expected that
its actuarial life had been extended further from its
earlier estimates at year 2038.
It is a
good thing that the stock market provided the backdrop
to the remarkable financial turnaround of the
institution, which, as of 2001, showed that its benefit
payments were more than the premiums it received plus
the earnings from its reserve fund.
Dipping
already into its reserve fund, the SSS‘s actuarial life
was estimated to last only until 2015. This necessitated
the introduction of radical fiscal reforms to rein in
expenses coupled by an aggressive recruitment campaign
among the overseas Filipino workers and the
self-employed that SSS chief Corazon de la Paz
instituted to arrest the decline in reserve funds.
The
immense success of the twin moves was noticeable in the
strengthening of the SSS reserve fund extending its
actuarial life to 2038 as of last year.
Flush
with an additional cash of P13.2 billion, the SSS would
have to look at other investment opportunities,
especially in the light of the low-interest regime
prevailing insofar as government debt notes are
concerned.
But the
bigger challenge that faces the pension fund is how to
further increase its members, a fact that President
Arroyo harped on when she graced the institution’s 50th
anniversary and underscored the need for the SSS’s
account officers to focus coverage on the “self-employed
workers, including those in the underground economy.”
The
status of the reserve fund is a continuing concern given
the fact that life-expectancy ratio is improving. This
constitutes a big drain on the reserve funds. There are
now more one million retirees of the SSS, which was
created in 1957 to provide security coverage to
employees in the private sector. Pensions range from the
lowest P1,000 monthly to a maximum of more than P23,000.
Last
year, the pension fund accounted for total collections
of P52.5 billion, up from P47.8 billion in 2005. But the
implementation of a pension increase in September meant
an additional P420 million in benefit payments. We
understand that this last pension fund increase would
mean P4 billion in total fund disbursements.
So the
challenge is for the SSS to fine-tune further its
investment strategy to ensure that it maximizes its
return and streamline its costs so that it could further
strengthen its actuarial life and benefit the next wave
of retirees from the baby boomers.
House
spectacle
The
ongoing public spectacle focused on the House of
Representatives is resulting in incalculable harm to the
institution.
As
charges and countercharges fly over the issue of
extortion accusations, the credibility of the House to
craft a legislative agenda that would redound to the
benefit of the populace, especially the poor, suffers.
Against this backdrop, it does not help any that even
the Speaker of the House is at the receiving end of
accusations leveled at him.
In fact,
the seeming inability of the Speaker to contain the
fallout from this public spectacle is being bandied
about as weakness that the allies of challenger Cebu
Rep.-elect Pablo Garcia has taken advantage of. To them,
Speaker de Venecia has apparently insulated himself from
the controversy as the pronouncements on the audit of
the funds that the Speaker controls sink in.
It would
be catastrophic for Congress to be distracted from its
legislative agenda to improve the lives of the poor,
such as in crafting legislation that would ensure, say,
the continued upsurge in tourism activities which
generates one job for each tourist. Passing laws as a
way to woo foreign investors to take advantage of
tourism business opportunities here could take a
backseat due to the animosity that accrues from the
speakership race.
But for
Manila Rep.-elect Amado Bagatsing, Speaker de Venecia
should answer for what he claimed was a deceptive way by
which a signature he affixed to a supposed legislative
agenda was made to appear as an endorsement of Mr. de
Venecia’s fifth run at the spearkership. Besides this,
the Manila solon has bared a supposed offer of an
envelope that, he said, contained cash but which he
refused.
Besides
Mr. Bagatsing, two others,
Cebu’s Antonio Cuenco and Amelita Villarosa, have similarly
disavowed the supposed endorsements that the camp of the
Speaker has bandied about as their supporters when the
solons were shepherded to Malacañang. Because of these
developments, they believe that the Speaker’s hold is
loosening.
The
public spectacle cannot be allowed to continue if only
to preserve the integrity of the institution. The
brickbats that fly from the opposing camps have
degenerated to personal levels that the crafting of
important legislation could be affected later on. What
would happen to economic bills when they are tabled with
the opposing camps still harboring pricked pride?
E-mail: hugagni@yahoo.com |
