FINANCE Secretary Benjamin E. Diokno said the Social Security System (SSS) needs to improve returns from its investment portfolio to better reflect the strength of the domestic economy, and urged the pension fund to put its money in infrastructure.
“There is still much work to be done. With the rapid expansion of our domestic economy and improved business outlook, the SSS should be able to improve its earnings from investments,” Mr. Diokno said during the pension fund’s 65th anniversary celebration on Friday.
“We must continuously strive to improve the quality and performance of our investments through better financial management and market engagement,” he added. “This would reassure our members that their contributions are indeed investments in the future.”
Mr. Diokno said the pension fund has managed to serve 40 million members and 2.9 million pensioners despite the challenges posed by the coronavirus disease 2019 (COVID-19) pandemic.
“In the last six years, the SSS hit the P1-trillion mark in benefit payments. And despite the impact of the COVID-19 pandemic on our economy, the SSS fund remains robust, secure, and well-managed,” he said.
Mr. Diokno has said that the Marcos administration is seeking investment from public and private insurance companies, including the SSS, to help fund its infrastructure program in an environment of tight budgets.
“We will maximize the use of long-term money for quality infrastructure,” he told reporters early last month.
“We will not mandate. But we will give them the option. It’s up to the individual boards to make a decision,” he said at the time.
Later last month, the SSS said it will invest some of its resources to the Build, Better, More infrastructure program.
SSS President and Chief Executive Officer Michael G. Regino said that the pension fund, which covers private-sector workers, is currently in talks with the Government Service Insurance System (GSIS), its counterpart pension fund for government employees. He said the GSIS has an infrastructure investment portfolio, unlike the SSS.
The government hopes to bring the infrastructure spending-to-gross domestic product (GDP) ratio to 5-6% each year between 2023 and 2028, even with high levels of government debt. The debt-to-GDP ratio in the second quarter was 62.1%, above the 60% threshold considered sustainable for developing economies.
The government is projecting economic growth of 6.5% to 7.5% this year and 6.5% to 8% next year until 2028. In the first half of 2022, growth has averaged 7.8%.
Mr. Diokno also commended the digitalization efforts of the SSS, particularly in its core business processes and frontline transactions.
“These improvements have enabled the government to accurately target beneficiaries and quickly distribute aid for the Small Business Wage Subsidy Program as part of the government’s COVID-19 response efforts to uplift our people and businesses,” he said, adding how these efforts were also recognized by international social security organizations.
In a statement on Tuesday, the Department of Finance said that the SSS digitized the filing of claims, with payouts disbursed through electronic wallets, cash payment outlets, PESONet, or the Union Bank of the Philippines QuickCard.
SSS salary and calamity loan applications, as well as the renewal of pension loans, have also moved online and processed in real time via the SSS mobile application. — Diego Gabriel C. Robles